BEST BUY CO INC, 10-K filed on 3/24/2017
Annual Report
Document and Entity Information (USD $)
In Billions, except Share data, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Mar. 20, 2017
Jul. 29, 2016
Document and Entity Information [Abstract}
 
 
 
Entity Registrant Name
BEST BUY CO INC 
 
 
Current Fiscal Year End Date
--01-28 
 
 
Entity Voluntary Filers
No 
 
 
Document Fiscal Year Focus
2017 
 
 
Amendment Flag
false 
 
 
Entity Current Reporting Status
Yes 
 
 
Entity Well-known Seasoned Issuer
Yes 
 
 
Entity Common Stock, Shares Outstanding
 
309,110,840 
 
Entity Public Float
 
 
$ 7.8 
Document Fiscal Period Focus
FY 
 
 
Document Type
10-K 
 
 
Entity Central Index Key
0000764478 
 
 
Document Period End Date
Jan. 28, 2017 
 
 
Entity Filer Category
Large Accelerated Filer 
 
 
CONSOLIDATED BALANCE SHEETS (USD $)
In Millions, unless otherwise specified
Jan. 28, 2017
Jan. 30, 2016
CURRENT ASSETS
 
 
Cash and cash equivalents
$ 2,240 
$ 1,976 
Short-term investments
1,681 
1,305 
Receivables, net
1,347 
1,162 
Merchandise inventories
4,864 
5,051 
Other current assets
384 
392 
Total current assets
10,516 
9,886 
Property and Equipment
 
 
Land and buildings
618 
613 
Leasehold improvements
2,227 
2,220 
Fixtures and equipment
4,998 
5,002 
Property under capital and financing leases
300 
272 
Property and equipment, gross
8,143 
8,107 
Less accumulated depreciation
5,850 
5,761 
Net property and equipment
2,293 
2,346 
Goodwill
425 
425 
Other Assets
622 
831 
Non-current assets held for sale
0 
31 
Total Assets
13,856 1
13,519 1
CURRENT LIABILITIES
 
 
Accounts payable
4,984 
4,450 
Unredeemed gift card liabilities
427 
409 
Deferred revenue
418 
357 
Accrued compensation and related expenses
358 
384 
Accrued liabilities
865 
802 
Accrued income taxes
26 
128 
Current portion of long-term debt
44 
395 
Total current liabilities
7,122 
6,925 
Long-Term Liabilities
704 
877 
Long-Term Debt
1,321 
1,339 
Contingencies and Commitments (Note 12)
   
   
Best Buy Co., Inc. Shareholders’ Equity
 
 
Preferred stock, $1.00 par value: Authorized — 400,000 shares; Issued and outstanding — none
0 
0 
Common stock, $0.10 par value: Authorized — 1.0 billion shares; Issued and outstanding — 311,108,000 and 323,779,000 shares, respectively
31 
32 
Prepaid Share Repurchase
0 
(55)
Additional paid-in capital
0 
0 
Retained earnings
4,399 
4,130 
Accumulated other comprehensive income
279 
271 
Total equity
4,709 
4,378 
Total Liabilities and Equity
$ 13,856 
$ 13,519 
CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) (USD $)
Jan. 28, 2017
Jan. 30, 2016
Preferred stock, par value (in dollars per share)
$ 1.00 
$ 1.00 
Preferred stock, Authorized shares
400,000 
400,000 
Preferred stock, Issued shares
0 
0 
Preferred stock, outstanding shares
0 
0 
Common stock, par value (in dollars per share)
$ 0.10 
$ 0.10 
Common stock, Authorized shares
1,000,000,000 
1,000,000,000 
Common stock, Issued shares
311,108,000 
323,779,000 
Common stock, outstanding shares
311,108,000 
323,779,000 
CONSOLIDATED STATEMENTS OF EARNINGS (USD $)
In Millions, except Per Share data, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Revenue
$ 39,403 
$ 39,528 
$ 40,339 
Cost of goods sold
29,963 
30,334 
31,292 
Restructuring charges — cost of goods sold
0 
3 
0 
Gross profit
9,440 1
9,191 2
9,047 
Selling, general and administrative expenses
7,547 
7,618 
7,592 
Restructuring charges
39 
198 
5 
Operating income
1,854 3
1,375 4
1,450 
Other income (expense)
 
 
 
Gain on sale of investments
3 
2 
13 
Investment income and other
31 
13 
14 
Interest expense
(72)
(80)
(90)
Earnings from continuing operations before income tax expense
1,816 
1,310 
1,387 
Income tax expense
609 
503 
141 
Net earnings from continuing operations
1,207 
807 
1,246 
Gain (loss) from discontinued operations (Note 2), net of tax expense of $7, $1 and $0
21 
90 
(11)
Net earnings including noncontrolling interests
1,228 
897 
1,235 
Net earnings from discontinued operations attributable to noncontrolling interests
0 
0 
(2)
Net earnings attributable to Best Buy Co., Inc. shareholders
$ 1,228 
$ 897 
$ 1,233 
Basic earnings (loss) per share attributable to Best Buy Co., Inc. shareholders
 
 
 
Continuing operations
$ 3.79 
$ 2.33 
$ 3.57 
Discontinued operations
$ 0.07 
$ 0.26 
$ (0.04)
Basic earnings per share
$ 3.86 
$ 2.59 
$ 3.53 
Diluted earnings (loss) per share attributable to Best Buy Co., Inc. shareholders
 
 
 
Continuing operations
$ 3.74 
$ 2.30 
$ 3.53 
Discontinued operations
$ 0.07 
$ 0.26 
$ (0.04)
Diluted earnings per share
$ 3.81 5
$ 2.56 5
$ 3.49 
Weighted-average common shares outstanding
 
 
 
Basic
318.5 
346.5 
349.5 
Diluted
322.6 
350.7 
353.6 
CONSOLIDATED STATEMENTS OF EARNINGS (PARENTHETICAL) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Tax effect of discontinued operations
$ 7 
$ 1 
$ 0 
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
OPERATING ACTIVITIES
 
 
 
Net earnings including noncontrolling interests
$ 1,228 
$ 897 
$ 1,235 
Adjustments to reconcile net earnings (loss) to total cash provided by operating activities
 
 
 
Depreciation
654 
657 
656 
Restructuring charges
39 
201 
23 
Gain on sale of business
0 
(99)
(1)
Stock-based compensation
108 
104 
87 
Deferred income taxes
201 
49 
(297)
Other Noncash Income (Expense)
(31)
38 
8 
Changes in operating assets and liabilities:
 
 
 
Receivables
(185)
123 
(19)
Merchandise inventories
193 
86 
(141)
Other assets
10 
36 
29 
Accounts payable
518 
(536)
434 
Other liabilities
23 
(140)
(164)
Income taxes
(213)
(94)
85 
Total cash provided by operating activities
2,545 
1,322 
1,935 
INVESTING ACTIVITIES
 
 
 
Additions to property and equipment, net of $48, $92 and $14 of non-cash capital expenditures
(582)1
(649)1
(561)1
Purchases of investments
(3,045)
(2,281)
(2,804)
Sales of investments
2,689 
2,427 
1,580 
Proceeds from sale of business, net of cash transferred
0 
103 
39 
Proceeds from sale of property, plant, and equipment
56 
0 
0 
Change in restricted assets
(8)
(47)
29 
Other, net
3 
28 
5 
Total cash used in investing activities
(887)
(419)
(1,712)
FINANCING ACTIVITIES
 
 
 
Repurchase of common stock
(698)
(1,000)
0 
Payments for Repurchase of Other Equity
0 
(55)
0 
Issuance of common stock
171 
47 
50 
Dividends paid
(505)
(499)
(251)
Repayments of debt
(394)
(28)
(24)
Other, net
22 
20 
2 
Total cash used in financing activities
(1,404)
(1,515)
(223)
Effect of Exchange Rate Changes on Cash
10 
(38)
(52)
Increase (Decrease) in Cash and Cash Equivalents
264 
(650)
(52)
Cash and Cash Equivalents at Beginning of Period, excluding held for sale
1,976 
2,432 
2,678 
Cash and Cash Equivalents Held-for-sale, at Beginning of Period
0 
194 
 
Cash and Cash Equivalents at End of Period
2,240 
1,976 
2,626 
Cash and Cash Equivalents Held-for-sale, at End of Period
0 
0 
(194)
Cash and Cash Equivalents at End of Period, excluding held for sale
2,240 
1,976 
2,432 
Supplemental Disclosure of Cash Flow Information
 
 
 
Income taxes paid
628 
550 
355 
Interest paid
$ 76 
$ 77 
$ 81 
CONSOLIDATED STATEMENTS OF CASH FLOWS (PARENTHETICAL) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Statement of Cash Flows [Abstract]
 
 
 
Non-cash capital expenditures
$ 48 
$ 92 
$ 14 
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (USD $)
In Millions, except Share data, unless otherwise specified
Total
Parent [Member]
Common Stock
Prepaid Share Repurchase
Additional Paid-In Capital
Retained Earnings
Accumulated Other Comprehensive Income (Loss)
Noncontrolling Interest
Beginning balances at Feb. 01, 2014
$ 3,989 
$ 3,986 
$ 35 
 
$ 300 
$ 3,159 
$ 492 
$ 3 
Beginning balances (in shares) at Feb. 01, 2014
 
 
347,000,000 
 
 
 
 
 
Increase (decrease) in shareholders' equity
 
 
 
 
 
 
 
 
Adjustment for fiscal year-end change (Note 2)
 
 
0 
 
0 
 
 
 
Net earnings (loss)
1,235 
1,233 
 
 
 
1,233 
0 
2 
Other comprehensive income (loss), net of tax:
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
(103)
(103)
 
 
 
 
(103)
0 
Unrealized loss on available-for-sale investments
(3)
(3)
 
 
 
 
(3)
0 
Reclassification of foreign currency translations adjustments into earnings due to sale of business
0 
 
 
 
 
 
 
 
Reclassification of (gains) losses on available-for-sale investments into earnings
(4)
(4)
 
 
 
 
(4)
0 
Issuance of common stock under employee stock purchase plan
8 
8 
0 
 
8 
0 
0 
0 
Issuance of common stock under employee stock purchase plan (in shares)
 
 
0 
 
 
 
 
 
Stock-based compensation
87 
87 
0 
 
87 
0 
0 
0 
Restricted stock vested and stock options exercised
42 
42 
0 
 
42 
0 
0 
0 
Stock options exercised (in shares)
 
 
5,000,000 
 
 
 
 
 
Common stock dividends, $1.57 per share during the period ended January 28, 2017, $1.43 per share during the period ended January 30, 2016, $0.72 per share during the period ended January 31, 2015, respectively
(251)
(251)
0 
 
0 
(251)
0 
0 
Ending balances at Jan. 31, 2015
5,000 
4,995 
35 
 
437 
4,141 
382 
5 
Ending balances (in shares) at Jan. 31, 2015
 
 
352,000,000 
 
 
 
 
 
Increase (decrease) in shareholders' equity
 
 
 
 
 
 
 
 
Net earnings (loss)
897 
897 
0 
 
0 
897 
0 
0 
Other comprehensive income (loss), net of tax:
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
(44)
(44)
0 
 
0 
0 
(44)
0 
Unrealized loss on available-for-sale investments
0 
 
 
 
 
 
 
 
Reclassification of foreign currency translations adjustments into earnings due to sale of business
(67)
(67)
0 
 
0 
0 
(67)
0 
Prepaid repurchase of common stock
(55)
(55)
 
(55)
 
 
 
 
Sale of noncontrolling interest
(5)
0 
0 
 
0 
0 
0 
(5)
Issuance of common stock under employee stock purchase plan
7 
7 
0 
 
7 
0 
0 
0 
Issuance of common stock under employee stock purchase plan (in shares)
 
 
0 
 
 
 
 
 
Stock-based compensation
104 
104 
0 
 
104 
0 
0 
0 
Restricted stock vested and stock options exercised
40 
40 
0 
 
40 
0 
0 
0 
Tax benefits from stock options exercised, restricted stock vesting and employee stock purchase plan
2 
2 
 
 
2 
 
 
 
Stock options exercised (in shares)
 
 
5,000,000 
 
 
 
 
 
Common stock dividends, $1.57 per share during the period ended January 28, 2017, $1.43 per share during the period ended January 30, 2016, $0.72 per share during the period ended January 31, 2015, respectively
(501)
(501)
0 
 
3 
(504)
0 
0 
Repurchase of common stock
(1,000)
(1,000)
(3)
 
(593)
(404)
 
 
Repurchase of common stock (in shares)
 
 
(33,000,000)
 
 
 
 
 
Ending balances at Jan. 30, 2016
4,378 
4,378 
32 
(55)
0 
4,130 
271 
0 
Ending balances (in shares) at Jan. 30, 2016
 
 
324,000,000 
 
 
 
 
 
Increase (decrease) in shareholders' equity
 
 
 
 
 
 
 
 
Net earnings (loss)
1,228 
1,228 
0 
 
0 
1,228 
0 
0 
Other comprehensive income (loss), net of tax:
 
 
 
 
 
 
 
 
Foreign currency translation adjustments
10 
10 
0 
 
0 
0 
10 
0 
Unrealized loss on available-for-sale investments
0 
 
 
 
 
 
 
 
Reclassification of foreign currency translations adjustments into earnings due to sale of business
(2)
(2)
0 
 
0 
0 
(2)
0 
Prepaid repurchase of common stock
55 
55 
 
55 
 
 
 
 
Issuance of common stock under employee stock purchase plan
7 
7 
0 
 
7 
0 
0 
0 
Issuance of common stock under employee stock purchase plan (in shares)
 
 
0 
 
 
 
 
 
Stock-based compensation
108 
108 
0 
 
108 
0 
0 
0 
Restricted stock vested and stock options exercised
164 
164 
1 
 
163 
0 
0 
0 
Tax benefits from stock options exercised, restricted stock vesting and employee stock purchase plan
17 
17 
 
 
17 
 
 
 
Stock options exercised (in shares)
5,273,000 
 
8,000,000 
 
 
 
 
 
Common stock dividends, $1.57 per share during the period ended January 28, 2017, $1.43 per share during the period ended January 30, 2016, $0.72 per share during the period ended January 31, 2015, respectively
(505)
(505)
0 
 
0 
(505)
0 
0 
Repurchase of common stock
(751)
(751)
(2)
 
(295)
(454)
 
 
Repurchase of common stock (in shares)
 
 
(21,000,000)
 
 
 
 
 
Ending balances at Jan. 28, 2017
$ 4,709 
$ 4,709 
$ 31 
$ 0 
$ 0 
$ 4,399 
$ 279 
$ 0 
Ending balances (in shares) at Jan. 28, 2017
 
 
311,000,000 
 
 
 
 
 
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (PARENTHETICAL)
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Statement of Stockholders' Equity [Abstract]
 
 
 
Dividends declared per common share (in dollars per share)
$ 1.57 
$ 1.43 
$ 0.72 
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Statement (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Net earnings including noncontrolling interests
$ 1,228 
$ 897 
$ 1,235 
Foreign currency translation adjustments
10 
(44)
(103)
Unrealized loss on available-for-sale investments
0 
0 
(3)
Reclassification of foreign currency translations adjustments into earnings due to sale of business
(2)
(67)
0 
Reclassification of gains on available-for-sale investments into earnings
0 
0 
(4)
Comprehensive income including noncontrolling interests
1,236 
786 
1,125 
Comprehensive income attributable to noncontrolling interests
0 
0 
(2)
Comprehensive income attributable to Best Buy Co., Inc. shareholders
$ 1,236 
$ 786 
$ 1,123 
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies

Unless the context otherwise requires, the use of the terms "Best Buy," "we," "us" and "our" in these Notes to Consolidated Financial Statements refers to Best Buy Co., Inc. and, as applicable, its consolidated subsidiaries.

Description of Business

We are a leading provider of technology products, services and solutions. We offer these products and services to the customers who visit our stores, engage with Geek Squad agents or use our websites or mobile applications. We have operations in the U.S., Canada and Mexico. We have two reportable segments: Domestic and International. The Domestic segment is comprised of the operations in all states, districts and territories of the U.S., under various brand names including Best Buy, bestbuy.com, Best Buy Mobile, Best Buy Direct, Best Buy Express, Geek Squad, Magnolia Home Theater and Pacific Kitchen and Home. The International segment is comprised of all operations in Canada and Mexico under the brand names Best Buy, bestbuy.com.ca, bestbuy.com.mx, Best Buy Express, Best Buy Mobile and Geek Squad.

Basis of Presentation

The consolidated financial statements include the accounts of Best Buy Co., Inc. and its consolidated subsidiaries. All intercompany balances and transactions are eliminated upon consolidation.

In order to align our fiscal reporting periods and comply with statutory filing requirements, we consolidate the financial results of our Mexico operations on a one-month lag. Our policy is to accelerate recording the effect of events occurring in the lag period that significantly affect our consolidated financial statements. No significant intervening event occurred in these operations that would have materially affected our financial condition, results of operations, liquidity or other factors had it been recorded during fiscal 2017, 2016 or 2015.

In preparing the accompanying consolidated financial statements, we evaluated the period from January 28, 2017, through the date the financial statements were issued for material subsequent events requiring recognition or disclosure. Other than as described in Note 7, Shareholders' Equity, no such events were identified for this period.

Discontinued Operations

On February 13, 2015, we sold Jiangsu Five Star Appliance Co., Limited ("Five Star"). The results of Five Star are presented as discontinued operations for all periods. See Note 2, Discontinued Operations, for further information.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. ("GAAP") requires us to make estimates and assumptions. These estimates and assumptions affect the reported amounts in the consolidated financial statements, as well as the disclosure of contingent liabilities. Future results could be materially affected if actual results were to differ from these estimates and assumptions.

Fiscal Year

Our fiscal year ends on the Saturday nearest the end of January. Fiscal 2017, 2016 and 2015 each included 52 weeks.

New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers. The new guidance establishes a single comprehensive model for entities to use in accounting for revenue and supersedes most current revenue recognition guidance. It introduces a five-step process for revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards under current guidance. It also requires significantly expanded disclosures regarding revenues.

Based on our preliminary assessment, we believe the impact of adopting the new guidance will be immaterial to our annual and interim financial statements. We believe that the impact will be limited to minor changes to the timing of recognition of revenues related to gift cards and loyalty programs.
We plan to adopt this standard in the first quarter of our fiscal 2019, using the modified retrospective method. Under this method, we will recognize the cumulative effect of the changes in retained earnings at the date of adoption, but will not restate prior periods.

In July 2015, the FASB issued ASU 2015-11, Inventory: Simplifying the Measurement of Inventory. The new guidance replaces the current inventory measurement requirement of lower of cost or market with the lower of cost or net realizable value. Based on the effective dates, we will prospectively adopt this standard in the first quarter of our fiscal 2018. We do not expect a material impact to our financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases. The new guidance was issued to increase transparency and comparability among companies by requiring most leases to be included on the balance sheet and by expanding disclosure requirements. Based on the effective dates, we expect to adopt the new guidance in the first quarter of fiscal 2020 using the modified retrospective method. While we expect adoption to lead to a material increase in the assets and liabilities recorded on our balance sheet, we are still evaluating the overall impact on our financial statements.

In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting. The new guidance changes certain aspects of accounting for share-based payments including accounting for income taxes, forfeitures and classifications in the statement of cash flows. We plan to adopt this standard in the first quarter of fiscal 2018, which aligns with the required adoption date. As allowed by ASU 2016-09, we plan to change our accounting for forfeitures from our current method of estimating the number of awards that are expected to vest to recording forfeitures as they occur. This will require a cumulative-effect adjustment to equity as of the beginning of fiscal 2018. We do not expect this adjustment to be material to our financial statements. In addition, we do not expect the remaining changes caused by ASU 2016-09 to have a material impact to our financial statements.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments, and in November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows: Restricted Cash. ASU 2016-15 provides classification requirements for specific transactions within the statement of cash flows, while ASU 2016-18 requires restricted cash balances be included in the beginning and ending cash balance within the statement of cash flows. We plan to retrospectively adopt these standards in the first quarter of our fiscal 2018, which is one year earlier than required. The adoption will increase our beginning and ending cash balance within our statement of cash flows by our restricted cash balances (see Restricted Assets section below) and will require a new disclosure to reconcile the cash balances within our statement of cash flows to the balance sheets. We do not expect any other material impacts to our financial statements.

Cash and Cash Equivalents

Cash primarily consists of cash on hand and bank deposits. Cash equivalents consist of money market funds, commercial paper, corporate bonds and time deposits with an original maturity of 3 months or less when purchased. The amounts of cash equivalents at January 28, 2017, and January 30, 2016, were $1,531 million and $1,208 million, respectively, and the weighted-average interest rates were 0.5% and 0.5%, respectively.

Receivables

Receivables consist principally of amounts due from mobile phone network operators for device sales and commissions; banks for customer credit card and debit card transactions; and vendors for various vendor funding programs.

We establish allowances for uncollectible receivables based on historical collection trends and write-off history. Our allowances for uncollectible receivables were $52 million and $49 million at January 28, 2017, and January 30, 2016, respectively.

Merchandise Inventories

Merchandise inventories are recorded at the lower of cost, using the average cost, or market. In-bound freight-related costs from our vendors are included as part of the net cost of merchandise inventories. Also included in the cost of inventory are certain vendor allowances that are not a reimbursement of specific, incremental and identifiable costs to promote a vendor's products. Other costs associated with acquiring, storing and transporting merchandise inventories to our retail stores are expensed as incurred and included in cost of goods sold.

Our inventory valuation reflects adjustments for anticipated physical inventory losses (e.g., theft) that have occurred since the last physical inventory. Physical inventory counts are taken on a regular basis to ensure that the inventory reported in our consolidated financial statements is properly stated.

Our inventory valuation also reflects markdowns for the excess of the cost over the amount we expect to realize from the ultimate sale or other disposal of the inventory. Markdowns establish a new cost basis for our inventory. Subsequent changes in facts or circumstances do not result in the reversal of previously recorded markdowns or an increase in the newly established cost basis.

Restricted Assets

Restricted cash totaled $193 million and $185 million at January 28, 2017, and January 30, 2016, respectively, and is included in other current assets in our Consolidated Balance Sheet. Such balances are pledged as collateral or restricted to use for general liability insurance and workers' compensation insurance.

Property and Equipment

Property and equipment are recorded at cost. We compute depreciation using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are depreciated over the shorter of their estimated useful lives or the period from the date the assets are placed in service to the end of the lease term, which includes optional renewal periods if they are reasonably assured. Accelerated depreciation methods are generally used for income tax purposes.

When property is retired or otherwise disposed of, the cost and accumulated depreciation are removed from our Consolidated Balance Sheets and any resulting gain or loss is reflected in our Consolidated Statements of Earnings.

Repairs and maintenance costs are charged directly to expense as incurred. Major renewals or replacements that substantially extend the useful life of an asset are capitalized and depreciated.

Costs associated with the acquisition or development of software for internal use are capitalized and amortized over the expected useful life of the software, generally from two to seven years. A subsequent addition, modification or upgrade to internal-use software is capitalized to the extent that it enhances the software's functionality or extends its useful life. Capitalized software is included in fixtures and equipment. Software maintenance and training costs are expensed in the period incurred.

Property under capital and financing leases is comprised of buildings and equipment used in our operations. These assets are typically depreciated over the shorter of the useful life of the asset or the term of the lease. The carrying value of property under capital and financing leases was $166 million and $165 million at January 28, 2017, and January 30, 2016, respectively, net of accumulated depreciation of $134 million and $107 million, respectively.

Estimated useful lives by major asset category are as follows:
Asset
 
Life
(in years)
Buildings
 
5-35
Leasehold improvements
 
3-15
Fixtures and equipment
 
2-15
Property under capital and financing leases
 
4-5


In fiscal 2017, we removed from our fixed asset balance $345 million of fully depreciated assets that were no longer in service. This asset adjustment was based primarily on an analysis of our fixed asset records and certain other validation procedures and had no material net impact to our fiscal 2017 Consolidated Financial Statements. The impact of this adjustment on amounts previously reported was determined to be immaterial to the Consolidated Financial Statements.

Impairment of Long-Lived Assets and Costs Associated With Exit Activities

Long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. Factors considered important that could result in an impairment review include, but are not limited to, significant under-performance relative to historical or planned operating results, significant changes in the manner of use or expected life of the assets or significant changes in our business strategies. An impairment loss is recognized when the estimated undiscounted cash flows expected to result from the use of the asset plus net proceeds expected from the disposition of the asset, if any, are less than the carrying value of the asset net of other liabilities. When an impairment loss is recognized, the carrying amount of the asset is reduced to its estimated fair value using valuation techniques such as discounted cash flow analysis.

When reviewing long-lived assets for impairment, we group long-lived assets with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. For example, long-lived assets deployed at store locations are reviewed for impairment at the individual store level, which involves comparing the carrying value of all land, buildings, leasehold improvements, fixtures and equipment located at each store to the net cash flow projections for each store. In addition, we conduct separate impairment reviews at other levels as appropriate, for example, to evaluate potential impairment of assets shared by several areas of operations, such as information technology systems. Refer to Note 3, Fair Value Measurements, for further information associated with the long-lived assets impairments, including valuation techniques used, impairment charges incurred and remaining carrying values.

The present value of costs associated with vacated properties, primarily future lease costs net of expected sublease income, are charged to earnings when we cease using the property. We accelerate depreciation on property and equipment we expect to retire when a decision is made to abandon a property.

At January 28, 2017, and January 30, 2016, the obligation associated with vacant properties included in accrued liabilities in our Consolidated Balance Sheets was $29 million and $44 million, respectively, and the obligation associated with vacant properties included in long-term liabilities in our Consolidated Balance Sheets was $37 million and $54 million, respectively. The obligation associated with vacant properties at January 28, 2017, and January 30, 2016, included amounts associated with our restructuring activities as further described in Note 4, Restructuring Charges.

Leases

We conduct the majority of our retail and distribution operations from leased locations. The leases generally require payment of real estate taxes, insurance and common area maintenance, in addition to rent. The terms of our new lease agreements for large-format stores are generally less than 10 years, although we have existing leases with terms up to 20 years. Small-format stores generally have lease terms that are half the length of large-format stores. Most of the leases contain renewal options and escalation clauses, and certain store leases require contingent rents based on factors such as specified percentages of revenue or the consumer price index.

For leases that contain predetermined fixed escalations of the minimum rent, we recognize the related rent expense on a straight-line basis from the date we take possession of the property to the end of the initial lease term. We record any difference between the straight-line rent amounts and amounts payable under the leases as part of deferred rent, in accrued liabilities or long-term liabilities, as appropriate.

Cash or lease incentives received upon entering into certain store leases ("tenant allowances") are recognized on a straight-line basis as a reduction to rent from the date we take possession of the property through the end of the initial lease term. We record the unamortized portion of tenant allowances as a part of deferred rent, in accrued liabilities or long-term liabilities, as appropriate.

At January 28, 2017, and January 30, 2016, deferred rent included in accrued liabilities in our Consolidated Balance Sheets was $33 million and $36 million, respectively, and deferred rent included in long-term liabilities in our Consolidated Balance Sheets was $121 million and $139 million, respectively.

In addition, we have financing leases for agreements when we are deemed the owner of the leased buildings, typically due to significant involvement during the construction period, and do not qualify for sales recognition under the sale-leaseback accounting guidance. We record the cost of the building in property and equipment, with the related short-term liability recorded in accrued liabilities and the longer-term liability recorded in long-term debt. At January 28, 2017, and January 30, 2016, we had $177 million and $178 million, respectively, outstanding under financing lease obligations. Refer to Note 8, Leases, for maturity details.
Assets acquired under capital and financing leases are depreciated over the shorter of the useful life of the asset or the lease term, including renewal periods, if reasonably assured.
Goodwill and Intangible Assets
Goodwill

Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations. We test goodwill for impairment annually, as of the first day of the fiscal fourth quarter, or when indications of potential impairment exist. We monitor the existence of potential impairment indicators throughout the fiscal year. We test for goodwill impairment at the reporting unit level and our reporting units are the components of operating segments which constitute businesses for which discrete financial information is available and is regularly reviewed by segment management. No components were aggregated in arriving at our reporting units. Our only reporting unit with a goodwill balance at the beginning of fiscal 2017 was our Domestic segment.

Our detailed impairment testing involves comparing the fair value of each reporting unit to its carrying value, including goodwill. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit and is based on discounted cash flows or relative market-based approaches. If the fair value exceeds carrying value, then it is concluded that no goodwill impairment has occurred. If the carrying value of the reporting unit exceeds its fair value, a second step is required to measure possible goodwill impairment loss. The second step includes hypothetically valuing the tangible and intangible assets and liabilities of the reporting unit as if the reporting unit had been acquired in a business combination. Then, the implied fair value of the reporting unit's goodwill is compared to the carrying value of that goodwill. If the carrying value of the reporting unit's goodwill exceeds the implied fair value of the goodwill, we recognize an impairment loss in an amount equal to the excess, not to exceed the carrying value. In fiscal 2017, we determined that the fair value of the Best Buy Domestic reporting unit exceeded its carrying value, and as a result, no goodwill impairment was recorded in fiscal 2017. No goodwill impairment was recorded in fiscal 2016.

Tradenames

We have an indefinite-lived tradename related to Pacific Sales included within our Domestic segment, which is recorded within other assets in our Consolidated Balance Sheets. As of the end of fiscal 2017, we have no indefinite-lived tradenames within our International segment.

Our valuation of identifiable intangible assets acquired is based on information and assumptions available to us at the time of acquisition, using income and market approaches to determine fair value. We do not amortize our indefinite-lived tradenames, but test for impairment annually, or when indications of potential impairment exist. We utilize the relief from royalty method to determine the fair value of each of our indefinite-lived tradenames. If the carrying value exceeds the fair value, we recognize an impairment loss in an amount equal to the excess. In fiscal 2017, we determined that the fair value of the tradename exceeded its carrying value, and as a result, no impairment was recorded in fiscal 2017. In fiscal 2016, as a part of the Canada brand restructuring, we fully impaired the indefinite-lived Future Shop tradename. Refer to Note 4, Restructuring Charges, for additional information. No other impairments were identified during fiscal 2016.

The changes in the carrying amount of goodwill and indefinite-lived tradenames by segment were as follows in fiscal 2017, 2016 and 2015 ($ in millions):
 
Goodwill
 
Indefinite-Lived Tradenames
 
Domestic
 
Domestic
 
International
 
Total
Balances at February 1, 2014
$
425

 
$
19

 
$
82

 
$
101

Sale of business(1)
—

 
—

 
(37
)
 
(37
)
Impairments
—

 
(1
)
 
—

 
(1
)
Changes in foreign currency exchange rates
—

 
—

 
(6
)
 
(6
)
Balances at January 31, 2015
425

 
18

 
39

 
57

Canada brand restructuring(2)
—

 
—

 
(40
)
 
(40
)
Changes in foreign currency exchange rates
—

 
—

 
1

 
1

Balances at January 30, 2016
425

 
18

 
—

 
18

Balances at January 28, 2017
$
425

 
$
18

 
$
—

 
$
18


(1)
Primarily represents the Five Star indefinite-lived tradenames classified as held for sale at January 31, 2015.
(2)
Represents the Future Shop tradename impaired as a result of the Canada brand restructuring in the first quarter of fiscal 2016. See Note 4, Restructuring Charges, for further discussion.
The following table provides the gross carrying amount of goodwill and cumulative goodwill impairment losses ($ in millions):
 
January 28, 2017
 
January 30, 2016
 
Gross Carrying
Amount
 
Cumulative
Impairment
 
Gross Carrying
Amount
 
Cumulative
Impairment
Goodwill
$
1,100

 
$
(675
)
 
$
1,100

 
$
(675
)

Insurance
 
We are self-insured for certain losses related to health, workers' compensation and general liability claims; however, we obtain third-party insurance coverage to limit our exposure to certain claims. Some of these self-insured losses are managed through a wholly-owned insurance captive. We estimate our self-insured liabilities using a number of factors, including historical claims experience, an estimate of incurred but not reported claims, demographic and severity factors and valuations provided by independent third-party actuaries. Our self-insured liabilities included in the Consolidated Balance Sheets were as follows ($ in millions):
 
January 28, 2017
 
January 30, 2016
Accrued liabilities
$
65

 
$
62

Long-term liabilities
63

 
54

Total
$
128

 
$
116



Income Taxes

We account for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. We record a valuation allowance to reduce the carrying amounts of deferred tax assets if it is more likely than not that such assets will not be realized.

In determining our provision for income taxes, we use an annual effective income tax rate based on annual income, permanent differences between book and tax income and statutory income tax rates. The effective income tax rate also reflects our assessment of the ultimate outcome of tax audits. We adjust our annual effective income tax rate as additional information on outcomes or events becomes available. Discrete events, such as audit settlements or changes in tax laws, are recognized in the period in which they occur.

Our income tax returns are periodically audited by U.S. federal, state and local and foreign tax authorities. At any one time, multiple tax years are subject to audit by the various tax authorities. In evaluating the tax benefits associated with our various tax filing positions, we record a tax benefit for uncertain tax positions using the highest cumulative tax benefit that is more likely than not to be realized. A number of years may elapse before a particular matter, for which we have established a liability, is audited and effectively settled. We adjust our liability for unrecognized tax benefits in the period in which we determine the issue is effectively settled with the tax authorities, the statute of limitations expires for the relevant taxing authority to examine the tax position or when more information becomes available. We include our liability for unrecognized tax benefits, including accrued penalties and interest, in accrued income taxes and long-term liabilities on our Consolidated Balance Sheets and in income tax expense in our Consolidated Statements of Earnings.

Accrued Liabilities

The major components of accrued liabilities at January 28, 2017, and January 30, 2016, were state and local tax liabilities, advertising accruals, rent-related liabilities, including accrued real estate taxes, loyalty program liabilities and self-insurance reserves.

Long-Term Liabilities

The major components of long-term liabilities at January 28, 2017, and January 30, 2016, were unrecognized tax benefits, rent-related liabilities, self-insurance reserves, deferred revenue and deferred compensation plan liabilities.

Foreign Currency

Foreign currency denominated assets and liabilities are translated into U.S. dollars using the exchange rates in effect at our Consolidated Balance Sheet date. For operations reported on a one-month lag, we use the exchange rates in effect one month prior to our Consolidated Balance Sheet date. Results of operations and cash flows are translated using the average exchange rates throughout the period. The effect of exchange rate fluctuations on the translation of assets and liabilities is included as a component of shareholders' equity in accumulated other comprehensive income. Gains and losses from foreign currency transactions, which are included in SG&A, have not been significant in any of the periods presented.

Revenue Recognition

We recognize revenue when the sales price is fixed or determinable, collection is reasonably assured and the customer takes possession of the merchandise, or in the case of services, the service has been provided. Revenue excludes sales taxes collected. Revenue from merchandise sales and services is reported net of sales returns, which includes an estimate of future returns based on historical return rates, with a corresponding reduction to cost of sales. Our sales returns reserve, which represents the estimated gross margin impact of returns, was $28 million and $25 million at January 28, 2017, and January 30, 2016, respectively.

For revenue transactions that involve multiple deliverables, we defer the revenue associated with any undelivered elements. The amount of revenue deferred in connection with the undelivered elements is determined using the relative fair value of each element, which is generally based on each element's relative retail price.
Our deferred revenues primarily relate to merchandise not yet delivered to customers, services not yet completed and technical support contracts not yet completed. Short-term deferred revenue was $418 million and $357 million as of January 28, 2017, and January 30, 2016, respectively. At January 28, 2017, and January 30, 2016, deferred revenue included within long-term liabilities in our Consolidated Balance Sheets was $34 million and $45 million, respectively.

Merchandise revenue
Revenue is recognized for store sales when the customer receives and pays for merchandise. In the case of items paid for in store but subsequently delivered to the customer, revenue is recognized once delivery has been completed.
For transactions initiated online, customers choose whether to collect merchandise from one of our stores (“in-store pick up”) or have it delivered to them (typically using third party parcel delivery companies). For in-store pick up, we recognize revenue once the customer has taken possession of merchandise. For items delivered directly to the customer, we recognize revenue when delivery has been completed. Any fees charged to customers for delivery are also recognized when delivery has been completed.
Services
Revenue related to consultation, design, installation, set-up, repair and educational classes are recognized once the service is complete. We sell various protection plans with extended warranty coverage for merchandise and technical support to assist customers in using their devices. Such plans have terms typically ranging from one month to five years. For extended warranty protection, third party underwriters assume the risk associated with the coverage and are deemed to be the legal obligor. We record the net commissions we receive (the amount charged to the customer less the premiums remitted to the underwriter) as revenue when the corresponding merchandise revenue is recognized. In addition, we are eligible to receive profit sharing payments, which are dependent upon the performance of the portfolio. We record such profit share as revenue once the portfolio period to which it relates is complete, and we have sufficient evidence to estimate the amount. Service and commission revenues earned from the sale of extended warranties represented 2.2%, 2.3% and 2.1% of revenue in fiscal 2017, 2016 and 2015, respectively. These percentages include $133 million, $158 million and $19 million, in fiscal 2017, 2016 and 2015, respectively, of profit share revenue.
For technical support contracts, we assume responsibility for fulfilling the support to customers and we recognize the associated revenue either on a straight-line basis over the life of the contracts, or, if sufficient history is available, on a consumption basis.
Credit card revenue
We offer promotional financing and credit cards issued by third-party banks that manage and directly extend credit to our customers. The banks are the sole owners of the accounts receivable generated under the program and accordingly, we do not hold any consumer receivables related to these programs. We are eligible to receive a profit share from our banking partners based on the performance of the programs. We record such profit share as revenue once the portfolio period to which it relates is complete, and we have sufficient evidence to estimate the amount.
Gift cards
We sell gift cards to our customers in our retail stores, online and through select third parties. We do not charge administrative fees on unused gift cards and our gift cards do not have an expiration date. We recognize revenue from gift cards when: (i) the gift card is redeemed by the customer; or (ii) the likelihood of the gift card being redeemed by the customer is remote, and we determine that we do not have a legal obligation to remit the value of unredeemed gift cards to the relevant jurisdictions ("gift card breakage"). We determine our gift card breakage rate based upon historical redemption patterns and recognize the projected breakage 24 months after the gift card is issued. Gift card breakage income is included in revenue in our Consolidated Statements of Earnings. Gift card breakage income was $37 million, $46 million and $19 million in fiscal 2017, 2016 and 2015, respectively.

Sales Incentives
We frequently offer sales incentives that entitle our customers to receive a gift card at time of purchase or a reduction in the price of a product or service either at the point of sale or by submitting a claim for a refund (for example coupons, rebates, etc.). For sales incentives issued to the customer in conjunction with a sale of merchandise or services, the reduction in revenue is recognized at the time of sale, based on the expected retail value of the incentive expected to be redeemed.
Customer Loyalty Programs
We have customer loyalty programs which allow members to earn points for each qualifying purchase. Points earned enable members to receive a certificate that may be redeemed on future purchases at our Best Buy branded stores. Depending on the customer's membership level within our loyalty program, certificates expirations typically range from 2 to 12 months from the date of issuance. The retail value of points earned by our loyalty program members is included in accrued liabilities and recorded as a reduction of revenue at the time the points are earned, based on the percentage of points that are projected to be redeemed.
We recognize revenue when: (i) a certificate is redeemed by the customer; (ii) a certificate expires; or (iii) the likelihood of a certificate being redeemed by a customer is low ("certificate breakage"). We determine our certificate breakage rate based upon historical redemption patterns.
Cost of Goods Sold and Selling, General and Administrative Expenses
The following table illustrates the primary costs classified in each major expense category:
Cost of Goods Sold
•
 
Total cost of products sold including:
 
 
—
 
Freight expenses associated with moving merchandise inventories from our vendors to our distribution centers;
 
 
—
 
Vendor allowances that are not a reimbursement of specific, incremental and identifiable costs; and
 
 
—
 
Cash discounts on payments to merchandise vendors;
•
 
Cost of services provided including:
 
 
—
 
Payroll and benefits costs for services employees; and
 
 
—
 
Cost of replacement parts and related freight expenses;
•
 
Physical inventory losses;
•
 
Markdowns;
•
 
Customer shipping and handling expenses;
•
 
Costs associated with operating our distribution network, including payroll and benefit costs, occupancy costs and depreciation; and
•
 
Freight expenses associated with moving merchandise inventories from our distribution centers to our retail stores.
SG&A
•
 
Payroll and benefit costs for retail and corporate employees;
•
 
Occupancy and maintenance costs of retail, services and corporate facilities;
•
 
Depreciation and amortization related to retail, services and corporate assets;
•
 
Advertising costs;
•
 
Vendor allowances that are a reimbursement of specific, incremental and identifiable costs to promote a vendor's products;
•
 
Tender costs, including bank charges and costs associated with credit and debit card interchange fees;
•
 
Charitable contributions;
•
 
Outside and outsourced service fees;
•
 
Long-lived asset impairment charges; and
•
 
Other administrative costs, such as supplies, travel and lodging.


Vendor Allowances
 
We receive allowances from certain vendors through a variety of programs and arrangements intended to offset our costs of promoting and selling merchandise inventories. Vendor allowances are primarily in the form of receipt-based funds or sell-through credits. Receipt-based funds are generally determined at an agreed percentage of purchase price and are initially deferred and recorded as a reduction of merchandise inventories. The deferred amounts are then included as a reduction of cost of goods sold when the related product is sold. Sell-through credits are generally calculated using an agreed upon amount for each unit sold and are recognized when the related product is sold. Vendor allowances provided as a reimbursement of specific, incremental and identifiable costs, such as specialized store labor or training costs, are included in SG&A as an expense reduction when the cost is incurred.
Advertising Costs
 
Advertising costs, which are included in SG&A, are expensed when the advertisement runs. Advertising costs consist primarily of digital, print and television advertisements, as well as promotional events. Advertising expenses were $743 million, $742 million and $711 million in fiscal 2017, 2016 and 2015, respectively.
Stock-Based Compensation
 
We apply the fair value recognition provisions of accounting guidance as they relate to our stock-based compensation, which requires us to recognize expense for the fair value of our stock-based compensation awards. Compensation expense is recognized over the period in which services are required. It is recognized on a straight-line basis, except where there are performance awards that vest on a graded basis in which case the expense for these awards is front-loaded, or recognized on a graded attribution basis.
Discontinued Operations
Discontinued Operations
Discontinued Operations

Discontinued operations are primarily comprised of Jiangsu Five Star Appliance Co., Limited ("Five Star") within our International segment. During the fourth quarter of fiscal 2015, we entered into a definitive agreement to sell our Five Star business to Yingtan City Xiangyuan Investment Limited Partnership and Zhejiang Jiayuan Real Estate Group Co. On February 13, 2015, we completed the sale of Five Star and recognized a gain on sale of $99 million. Following the sale of Five Star, we continued to hold as available for sale one retail property in Shanghai, China. The assets of this property were classified as held for sale in the Consolidated Balance Sheets and were $31 million as of January 30, 2016. In May 2016, we completed the sale of the property and recognized a gain, net of income tax, of $16 million. The gain on sale of the property is included in other, net within operating activities in the Consolidated Statements of Cash Flows.

The aggregate financial results of all discontinued operations for fiscal 2017, 2016 and 2015 were as follows ($ in millions):
 
2017
 
2016
 
2015
Revenue
$
—

 
$
217

 
$
1,564

Restructuring charges(1)
—

 
1

 
18

Gain (loss) from discontinued operations before income tax expense
28

 
(8
)
 
(12
)
Income tax expense
(7
)
 
(1
)
 
—

Gain on sale of discontinued operations
—

 
99

 
1

Net earnings (loss) from discontinued operations including noncontrolling interests
21

 
90

 
(11
)
Net earnings from discontinued operations attributable to noncontrolling interests
—

 
—

 
(2
)
Net earnings (loss) from discontinued operations attributable to Best Buy Co., Inc. shareholders
$
21

 
$
90

 
$
(13
)
(1)
See Note 4, Restructuring Charges, for further discussion of the restructuring charges associated with discontinued operations.
Fair Value Measurements
Fair Value Measurements
Fair Value Measurements

Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. To measure fair value, we use a three-tier valuation hierarchy based upon observable and non-observable inputs:

Level 1 — Unadjusted quoted prices that are available in active markets for identical assets or liabilities at the measurement date.

Level 2 — Significant other observable inputs available at the measurement date, other than quoted prices included in Level 1, either directly or indirectly, including:

•
Quoted prices for similar assets or liabilities in active markets;
•
Quoted prices for identical or similar assets in non-active markets;
•
Inputs other than quoted prices that are observable for the asset or liability; and
•
Inputs that are derived principally from or corroborated by other observable market data.

Level 3 — Significant unobservable inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management's estimates of market participant assumptions.

Assets and Liabilities that are Measured at Fair Value on a Recurring Basis

The fair value hierarchy requires the use of observable market data when available. In instances in which the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability.

The following table sets forth by level within the fair value hierarchy, our financial assets and liabilities that were accounted for at fair value on a recurring basis at January 28, 2017, and January 30, 2016, according to the valuation techniques we used to determine their fair values ($ in millions):
 
 
 
Fair Value at
 
Fair Value Hierarchy
 
January 28, 2017
 
January 30, 2016
Assets
 
 
 
 
 
Cash and cash equivalents
 
 
 
 
 
Money market funds
Level 1
 
$
290

 
$
51

Commercial paper
Level 2
 
—

 
265

Time deposits
Level 2
 
15

 
306

Short-term investments
 
 
 
 
 
Corporate bonds
Level 2
 
—

 
193

Commercial paper
Level 2
 
349

 
122

Time deposits
Level 2
 
1,332

 
990

Other current assets
 
 
 
 
 
Money market funds
Level 1
 
7

 
—

Commercial paper
Level 2
 
60

 
—

Foreign currency derivative instruments
Level 2
 
2

 
18

Time deposits
Level 2
 
100

 
79

Other assets
 
 
 
 
 
Interest rate swap derivative instruments
Level 2
 
13

 
25

Auction rate securities
Level 3
 
—

 
2

Marketable securities that fund deferred compensation
Level 1
 
96

 
96

Liabilities
 
 
 
 
 
Accrued Liabilities
 
 
 
 
 
Foreign currency derivative instruments
Level 2
 
3

 
1

 
There were no transfers between levels during fiscal 2017 and 2016. During fiscal 2017, our remaining investments in auction rate securities ("ARS") were called at par, which resulted in proceeds of $2 million and no realized gain or loss. As of January 28, 2017, we had no items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3). For the periods ended January 30, 2016 there were no changes in the beginning and ending balances of items measured at fair value on a recurring basis that used significant unobservable inputs (Level 3).

The following methods and assumptions were used to estimate the fair value of each class of financial instrument:
 
Money Market Funds. Our money market fund investments were measured at fair value as they trade in an active market using quoted market prices and, therefore, are classified as Level 1.

Commercial Paper. Our investments in commercial paper were measured using inputs based upon quoted prices for similar instruments in active markets and, therefore, were classified as Level 2.

Time Deposits. Our time deposits are balances held with banking institutions that cannot be withdrawn for specified terms without a penalty. Time deposits are held at face value plus accrued interest, which approximates fair value, and are classified as Level 2.

Corporate Bonds. Our corporate bond investments were measured at fair value using quoted market prices. They were classified as Level 2 as they trade in a non-active market for which bond prices are readily available.
 
Foreign Currency Derivative Instruments. Comprised primarily of foreign currency forward contracts and foreign currency swap contracts, our foreign currency derivative instruments were measured at fair value using readily observable market inputs, such as quotations on forward foreign exchange points and foreign interest rates. Our foreign currency derivative instruments were classified as Level 2 as these instruments are custom, over-the-counter contracts with various bank counterparties that are not traded in an active market.

Interest Rate Swap Derivative Instruments. Our interest rate swap contracts were measured at fair value using readily observable inputs, such as the LIBOR interest rate. Our interest rate swap derivative instruments were classified as Level 2 as these instruments are custom, over-the-counter contracts with various bank counterparties that are not traded in an active market.
 
Auction Rate Securities. Our investments in auction rate securities ("ARS") were classified as Level 3 as quoted prices were unavailable. Due to limited market information, we utilized a discounted future cash flows ("DCF") model to derive an estimate of fair value. The assumptions we used in preparing the DCF model include estimates with respect to the amount and timing of future interest and principal payments, forward projections of the interest rate benchmarks, the probability of full repayment of the principal considering the credit quality and guarantees in place, and the rate of return required by investors to own such securities given the current liquidity risk associated with ARS.
 
Marketable Securities that Fund Deferred Compensation. The assets that fund our deferred compensation consist of investments in mutual funds. These investments were classified as Level 1 as the shares of these mutual funds trade with sufficient frequency and volume to enable us to obtain pricing information on an ongoing basis.
 
Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis
 
Assets and liabilities that are measured at fair value on a nonrecurring basis relate primarily to our tangible fixed assets, goodwill and other intangible assets, which are remeasured when the derived fair value is below carrying value on our Consolidated Balance Sheets. For these assets, we do not periodically adjust carrying value to fair value, except in the event of impairment. When we determine that impairment has occurred, the carrying value of the asset is reduced to fair value and the difference is recorded within operating income in our Consolidated Statements of Earnings.
 
There were no fair value remeasurements for non-restructuring property and equipment impairments and restructuring activities related to discontinued operations recorded in fiscal 2017 and 2016. The following table summarizes the fair value remeasurements for non-restructuring property and equipment impairments and restructuring activities related to continuing operations recorded in fiscal 2017 and 2016 ($ in millions):
 
2017
 
2016
 
Impairments
 
Remaining Net
Carrying Value(1)
 
Impairments
 
Remaining Net
Carrying Value (1)
Property and equipment (non-restructuring)
$
28

 
$
—

 
$
61

 
$
15

Restructuring activities(2)
 
 
 
 
 
 
 
Property and equipment
8

 
—

 
30

 
—

Tradename
—

 
—

 
40

 
—

Total
$
36

 
$
—

 
$
131

 
$
15

(1)
Remaining net carrying value approximates fair value. Because assets subject to long-lived asset impairment are not measured at fair value on a recurring basis, certain fair value measurements presented in the table may reflect values at earlier measurement dates and may no longer represent the fair values at January 28, 2017, and January 30, 2016.
(2)
See Note 4, Restructuring Charges, for additional information.

All of the fair value remeasurements included in the table above were based on significant unobservable inputs (Level 3). Fixed asset fair values were derived using a DCF model to estimate the present value of net cash flows that the asset or asset group is expected to generate. The key inputs to the DCF model generally included our forecasts of net cash generated from revenue, expenses and other significant cash outflows, such as capital expenditures, as well as an appropriate discount rate. In the case of assets for which the impairment was the result of restructuring activities, no future cash flows have been assumed as the assets will cease to be used and expected sale values are nominal.

Fair Value of Financial Instruments

Our financial instruments, other than those presented in the disclosures above, include cash, receivables, other investments, accounts payable, other payables and long-term debt. The fair values of cash, receivables, accounts payable and other payables approximated carrying values because of the short-term nature of these instruments. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. Fair values for other investments held at cost are not readily available, but we estimate that the carrying values for these investments approximate fair value. See Note 5, Debt, for information about the fair value of our long-term debt.
Restructuring Charges
Restructuring Charges
Restructuring Charges
 
Summary
 
Restructuring charges incurred in fiscal 2017, 2016 and 2015 were as follows ($ in millions):
 
2017
 
2016
 
2015
Continuing operations
 
 
 
 
 
Renew Blue Phase 2
$
26

 
$
—

 
$
—

Canadian brand consolidation
3

 
200

 
—

Renew Blue(1)
5

 
(2
)
 
11

Other restructuring activities(2)
5

 
3

 
(6
)
Total continuing operations
39

 
201

 
5

Discontinued operations
 
 
 
 
 
Renew Blue(1)
—

 
—

 
18

Total
$
39

 
$
201

 
$
23


(1) Represents activity related to our remaining termination benefits and vacant space liabilities, primarily in our International segment, for our Renew Blue restructuring program, which began in the fourth quarter of fiscal 2013. Continuing operations charges related to the Domestic segment were $0 million, benefit of $1 million and $10 million for fiscal 2017, 2016 and 2015, respectively; and to the International segment were $5 million, benefit of $1 million and $1 million for fiscal 2017, 2016 and 2015, respectively. All discontinued operations charges related to the International segment. As of January 28, 2017, the termination benefits liability was $0 million and the remaining vacant space liability was $9 million. We may continue to incur immaterial adjustments to the vacant space liability for charges in sublease assumptions or potential lease buyouts. In addition, lease payments for vacated stores will continue until leases expire or are terminated.

(2) Represents activity related to our remaining vacant space liability for U.S. large-format store closures in fiscal 2013. We may continue to incur immaterial adjustments to the liability for changes in sublease assumptions or potential lease buyouts. In addition, lease payments for vacated stores will continue until leases expire or are terminated. The remaining vacant space liability was $14 million at January 28, 2017.

Renew Blue Phase 2

In the first quarter of fiscal 2017, we took several strategic actions to eliminate and simplify certain components of our operations and restructure certain field and corporate teams as part of our Renew Blue Phase 2 plan. In fiscal 2017, we incurred $26 million of restructuring charges related to implementing these changes, which primarily consisted of employee termination benefits and property and equipment impairments. All restructuring charges related to this plan are from continuing operations and are presented in restructuring charges in our Consolidated Statement of Earnings.

The composition of the restructuring charges we incurred during fiscal 2017 for Renew Blue Phase 2 was as follows ($ in millions):
 
Domestic
 
2017
Property and equipment impairments
$
8

Termination benefits
18

      Total Renew Blue Phase 2 restructuring charges
$
26



The following table summarizes our restructuring accrual activity during fiscal 2017 related to termination benefits as a result of Renew Blue Phase 2 ($ in millions):
 
Termination
Benefits
Balances at January 30, 2016
$
—

Charges
19

Cash payments
(17
)
Adjustments
(2
)
Balances at January 28, 2017
$
—



Canadian Brand Consolidation

In the first quarter of fiscal 2016, we consolidated the Future Shop and Best Buy stores and websites in Canada under the Best Buy brand. This resulted in the permanent closure of 66 Future Shop stores and the conversion of the remaining 65 Future Shop stores to the Best Buy brand. In fiscal 2017, we incurred $3 million of restructuring charges related to lease exit costs. During fiscal 2016, we incurred $200 million of restructuring charges, which primarily consisted of lease exit costs, a tradename impairment, property and equipment impairments, employee termination benefits and inventory write-downs. The inventory write-downs related to our Canadian brand consolidation are presented in restructuring charges – cost of goods sold in our Consolidated Statements of Earnings, and the remainder of the restructuring charges are presented in restructuring charges in our Consolidated Statements of Earnings.

The composition of the restructuring charges we incurred for this program in fiscal 2017 and 2016, as well as the cumulative amount incurred through the end of fiscal 2017, was as follows ($ in millions):
 
International
 
2017
 
2016
 
Cumulative Amount
Continuing operations
 
 
 
 
 
Inventory write-downs
$
—

 
$
3

 
$
3

Property and equipment impairments
—

 
30

 
30

Tradename impairment
—

 
40

 
40

Termination benefits
—

 
25

 
25

Facility closure and other costs
3

 
102

 
105

Total continuing operations
$
3

 
$
200

 
$
203



The following tables summarize our restructuring accrual activity during the fiscal 2017 and 2016, related to termination benefits and facility closure and other costs associated with Canadian brand consolidation ($ in millions):
 
Termination
Benefits
 
Facility
Closure and
Other Costs
 
Total
Balances at January 31, 2015
$
—

 
$
—

 
$
—

Charges
28

 
113

 
141

Cash payments
(24
)
 
(47
)
 
(71
)
Adjustments(1)
(2
)
 
5

 
3

Changes in foreign currency exchange rates
—

 
(7
)
 
(7
)
Balances at January 30, 2016
$
2

 
$
64

 
$
66

Charges
—

 
1

 
1

Cash payments
(2
)
 
(37
)
 
(39
)
Adjustments(1)
—

 
2

 
2

Changes in foreign currency exchange rates
—

 
4

 
4

Balances at January 28, 2017
$
—

 
$
34

 
$
34

(1) The adjustments related to termination benefits relate to higher-than-expected employee retention. Adjustments to facility closure and other costs represent changes in sublease assumptions.
Debt
Debt
Debt
 
Short-Term Debt

U.S. Revolving Credit Facilities

On June 27, 2016, we entered into a $1.25 billion five-year senior unsecured revolving credit facility agreement (the "Five-Year Facility Agreement") with a syndicate of banks. The Five-Year Facility Agreement replaced the previous $1.25 billion senior unsecured revolving credit facility (the "Previous Facility") with a syndicate of banks, which was originally scheduled to expire in June 2019, but was terminated on June 27, 2016.

The interest rate under the Five-Year Facility Agreement is variable and is determined at our option as: (i) the sum of (a) the greatest of (1) JPMorgan Chase Bank, N.A.'s prime rate, (2) the greater of the federal funds rate and the overnight bank funding rate plus, in each case, 0.5%, and (3) the one-month London Interbank Offered Rate (“LIBOR”), subject to certain adjustments plus 1%, and (b) a variable margin rate (the “ABR Margin”); or (ii) the LIBOR plus a variable margin rate (the “LIBOR Margin”). In addition, a facility fee is assessed on the commitment amount. The ABR Margin, LIBOR Margin and the facility fee are based upon our current senior unsecured debt rating. Under the Five-Year Facility Agreement, the ABR Margin ranges from 0.00% to 0.50%, the LIBOR Margin ranges from 0.90% to 1.50% and the facility fee ranges from 0.10% to 0.25%. At January 28, 2017, and January 30, 2016, there were no borrowings outstanding. As of January 28, 2017, $1.25 billion was available under the Five-Year Facility Agreement.
 
The Five-Year Facility Agreement is guaranteed by certain of our subsidiaries and contains customary affirmative and negative covenants materially consistent with the Previous Facility. Among other things, these covenants restrict our and certain of our subsidiaries' ability to incur certain types or amounts of indebtedness, incur liens on certain assets, make material changes in corporate structure or the nature of our business, dispose of material assets, engage in a change in control transaction, make certain foreign investments, enter into certain restrictive agreements, or engage in certain transactions with affiliates. The Five-Year Facility Agreement also contains covenants that require us to maintain a maximum quarterly cash flow leverage ratio and a minimum quarterly interest coverage ratio (both ratios measured quarterly for the previous 12 months). The Five-Year Facility Agreement contains default provisions including, but not limited to, failure to pay interest or principal when due and failure to comply with covenants.

Long-Term Debt
 
Long-term debt consisted of the following ($ in millions):
 
January 28, 2017
 
January 30, 2016
2016 Notes
$
—

 
$
350

2018 Notes
500

 
500

2021 Notes
650

 
650

Interest rate swap valuation adjustments
13

 
25

Subtotal
1,163

 
1,525

Debt discounts and issuance costs
(5
)
 
(7
)
Financing lease obligations
177

 
178

Capital lease obligations
30

 
38

Total long-term debt
1,365

 
1,734

Less: current portion
(44
)
 
(395
)
Total long-term debt, less current portion
$
1,321

 
$
1,339



2018 Notes
 
On July 16, 2013, we completed the sale of $500 million principal amount of notes due August 1, 2018 (the “2018 Notes”). The 2018 Notes bear interest at a fixed rate of 5.00% per year, payable semi-annually on February 1 and August 1 of each year, beginning on February 1, 2014. Net proceeds from the sale of the 2018 Notes were $495 million, after underwriting and issue discounts totaling $5 million.
We may redeem some or all of the 2018 Notes at any time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2018 Notes to be redeemed and (2) the sum of the present values of each remaining scheduled payment of principal and interest on the 2018 Notes to be redeemed discounted to the redemption date on a semi-annual basis at the Treasury Rate plus 50 basis points. Furthermore, if a change of control triggering event occurs, we will be required to offer to purchase the remaining unredeemed 2018 Notes at a price equal to 101% of their principal amount, plus accrued and unpaid interest to the purchase date.
 
The 2018 Notes are unsecured and unsubordinated obligations and rank equally with all of our other unsecured and unsubordinated debt. The 2018 Notes contain covenants that, among other things, limit our ability and the ability of our subsidiaries to incur debt secured by liens and enter into sale and lease-back transactions.
 
2016 and 2021 Notes
 
In March 2011, we issued $350 million principal amount of notes due March 15, 2016 (the “2016 Notes”) and $650 million principal amount of notes due March 15, 2021 (the “2021 Notes” and, together with the 2016 Notes, the “Notes”). In March 2016, we repaid the 2016 Notes using existing cash resources. The 2016 Notes bore interest at a fixed rate of 3.75% per year, while the 2021 Notes bear interest at a fixed rate of 5.50% per year. Interest on the 2021 Notes is payable semi-annually on March 15 and September 15 of each year, beginning on September 15, 2011. The 2021 Notes were issued at a slight discount to par, which when coupled with underwriting discounts of $6 million, resulted in net proceeds from the sale of the Notes of $990 million.
 
We may redeem some or all of the 2021 Notes at any time at a redemption price equal to the greater of (i) 100% of the principal amount and (ii) the sum of the present values of each remaining scheduled payment of principal and interest discounted to the redemption date on a semiannual basis, plus accrued and unpaid interest on the principal amount to the redemption date as described in the indenture (including the supplemental indenture) relating to the 2021 Notes. Furthermore, if a change of control triggering event occurs, we will be required to offer to purchase the remaining unredeemed 2021 Notes at a price equal to 101% of their principal amount, plus accrued and unpaid interest to the purchase date.

The 2021 Notes are unsecured and unsubordinated obligations and rank equally with all of our other unsecured and unsubordinated debt. The 2021 Notes contain covenants that, among other things, limit our ability to incur debt secured by liens or to enter into sale and lease-back transactions.
 
Fair Value and Future Maturities
 
The fair value of long-term debt, excluding debt discounts and issuance costs and financing and capital lease obligations, approximated $1,240 million and $1,543 million at January 28, 2017, and January 30, 2016, respectively, based primarily on the quoted market prices, compared to carrying values of $1,163 million and $1,525 million, respectively. If our long-term debt was recorded at fair value, it would be classified as Level 2 in the fair value hierarchy.
 
At January 28, 2017, the future maturities of long-term debt, excluding debt discounts and issuance costs and financing and capital lease obligations (see Note 8, Leases, for the future lease obligation maturities), consisted of the following ($ in millions):
Fiscal Year
 
2018
$
—

2019
511

2020
—

2021
—

2022
652

Thereafter
—

Total long-term debt
$
1,163

Derivative Instruments (Notes)
Derivative Instruments
Derivative Instruments

We manage our economic and transaction exposure to certain risks through the use of foreign currency derivative instruments and interest rate swaps. Our objective in holding derivatives is to reduce the volatility of net earnings, cash flows and net asset value associated with changes in foreign currency exchange rates and interest rates. We do not hold derivative instruments for trading or speculative purposes. We have no derivatives that have credit risk-related contingent features, and we mitigate our credit risk by engaging with financial institutions with investment grade credit ratings as our counterparties.

We record all derivative instruments on our Consolidated Balance Sheet at fair value and evaluate hedge effectiveness prospectively and retrospectively when electing to apply hedge accounting. We formally document all hedging relations at inception for derivative hedges and the underlying hedged items, as well as the risk management objectives and strategies for undertaking the hedge transaction. In addition, we have derivatives which are not designated as hedging instruments.

Net Investment Hedges

We use foreign exchange forward contracts to hedge against the effect of Canadian dollar exchange rate fluctuations on a portion of our net investment in our Canadian operations. The contracts have terms up to 12 months. For a net investment hedge, we recognize changes in the fair value of the derivative as a component of foreign currency translation within other comprehensive income to offset a portion of the change in translated value of the net investment being hedged, until the investment is sold or liquidated. We limit recognition in net earnings of amounts previously recorded in other comprehensive income to circumstances such as complete or substantially complete liquidation of the net investment in the hedged foreign operation. We report the ineffective portion of the gain or loss, if any, in net earnings.

Interest Rate Swaps

We use "receive fixed-rate, pay variable-rate" interest rate swaps to mitigate the effect of interest rate fluctuations on a portion of our 2018 Notes and 2021 Notes. Our interest rate swap contracts are considered perfect hedges because the critical terms and notional amounts match those of our fixed-rate debt being hedged and are therefore accounted as a fair value hedge using the shortcut method. Under the shortcut method, we recognize the change in the fair value of the derivatives with an offsetting change to the carrying value of the debt. Accordingly, there is no impact on our Consolidated Statements of Earnings from the fair value of the derivatives.

Derivatives Not Designated as Hedging Instruments

We use foreign currency forward contracts to manage the impact of fluctuations in foreign currency exchange rates relative to recognized receivable and payable balances denominated in non-functional currencies. The contracts generally have terms of up to 12 months. These derivative instruments are not designated in hedging relationships and, therefore, we record gains and losses on these contracts directly to net earnings.

Summary of Derivative Balances

The following table presents the gross fair values for outstanding derivative instruments and the corresponding classification at January 28, 2017, and January 30, 2016:
 
January 28, 2017
 
January 30, 2016
Contract Type
Assets
Liabilities
 
Assets
Liabilities
Derivatives designated as net investment hedges(1)
$
2

$
2

 
$
15

$
1

Derivatives designated as interest rate swaps(2)
13

—

 
25

—

No hedge designation (foreign exchange forward contracts)(1)
—

1

 
3

—

Total
$
15

$
3

 
$
43

$
1

(1)
The fair value is recorded in other current assets or accrued liabilities.
(2)
The fair value is recorded in other assets or long-term liabilities.
    
The following table presents the effects of derivative instruments on other comprehensive income ("OCI") and on our Consolidated Statements of Earnings for fiscal 2017 and 2016:
 
2017
 
2016
Contract Type
Pre-tax Gain (Loss) Recognized in OCI
 
Gain(Loss) Reclassified from Accumulated OCI to Earnings
(Effective Portion)
 
Pre-tax Gain (Loss) Recognized in OCI
 
Gain(Loss) Reclassified from Accumulated OCI to Earnings
(Effective Portion)
Derivatives designated as net investment hedges
$
(14
)
 
$
—

 
$
21

 
$
—



The following table presents the effects of derivatives on our Consolidated Statements of Earnings for fiscal 2017 and 2016:
 
Gain (Loss) Recognized within SG&A
Contract Type
2017
 
2016
No hedge designation (foreign exchange forward contracts)
$
(3
)
 
$
4



The following table presents the effects of interest rate derivatives on our Consolidated Statements of Earnings for fiscal 2017 and 2016:
 
Gain (Loss) Recognized within Interest Expense
Contract Type
2017
 
2016
Interest rate swap gain (loss)
$
(12
)
 
$
23

Adjustments to carrying value of long-term debt
12

 
(23
)
Net impact on consolidated statement of earnings
$
—

 
$
—



The following table presents the notional amounts of our derivative instruments at January 28, 2017, and January 30, 2016:
 
Notional Amount
Contract Type
January 28, 2017
 
January 30, 2016
Derivatives designated as net investment hedges
$
205

 
$
208

Derivatives designated as interest rate swaps
750

 
750

No hedge designation (foreign exchange forward contracts)
43

 
94

Total
$
998

 
$
1,052

Shareholders' Equity
Shareholders Equity
Shareholders' Equity

Stock Compensation Plans

Our 2014 Omnibus Incentive Plan (the "Omnibus Plan") authorizes us to grant or issue non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units and other equity awards up to a total of 22.5 million shares. We have not granted incentive stock options under the Omnibus Plan. Under the terms of the Omnibus Plan, awards may be granted to our employees, officers, advisers, consultants and directors. Awards issued under the Omnibus Plan vest as determined by the Compensation and Human Resources Committee of our Board of Directors at the time of grant. Awards granted, forfeited or canceled under the previous plan, the 2004 Omnibus Stock and Incentive Plan, after February 1, 2014, adjust the amount available under the Omnibus Plan. At January 28, 2017, a total of 14.6 million shares were available for future grants under the Omnibus Plan.

Upon adoption and approval of the Omnibus Plan, all of our previous equity incentive compensation plans were terminated. However, existing awards under those plans continued to vest in accordance with the original vesting schedule and will expire at the end of their original term.

Our outstanding stock options have a 10-year term. Outstanding stock options issued to employees generally vest over a three-year period. Share awards vest based either upon attainment of specified goals or solely upon continued employment ("time-based"). Outstanding share awards that are not time-based vest at the end of a three-year incentive period based upon our total shareholder return ("TSR") compared to the TSR of companies that comprise Standard & Poor's 500 Index ("market-based") or upon the achievement of company performance goals ("performance-based"). We have time-based share awards that vest in their entirety at the end of three-year periods, time-based share awards where 25% of the award vests on the date of grant and 25% vests on each of the three anniversary dates thereafter and time-based share awards to directors that vest one year from the grant date.

Our Employee Stock Purchase Plan, as amended, permits employees to purchase our common stock at a 5% discount from the market price at the end of semi-annual purchase periods and is non-compensatory. Employees are required to hold the common stock purchased for 12 months. In fiscal 2017, 2016 and 2015, 0.2 million, 0.2 million and 0.3 million shares, respectively, were purchased through our employee stock purchase plans. At January 28, 2017, and January 30, 2016, plan participants had accumulated $2 million and $2 million, respectively, to purchase our common stock pursuant to these plans.

Stock-based compensation expense was as follows in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Stock options
$
9

 
$
15

 
$
17

Share awards
 
 
 
 
 
Market-based
15

 
16

 
10

Performance-based
6

 
—

 
—

Time-based
78

 
73

 
60

Total
$
108

 
$
104

 
$
87


 
Stock Options
 
Stock option activity was as follows in fiscal 2017:
 
Stock
Options
 
Weighted-Average Exercise Price per Share
 
Weighted-Average Remaining Contractual Term
(in years)
 
Aggregate
Intrinsic Value
(in millions)
Outstanding at January 30, 2016
14,242,000

 
$
36.51

 
 
 
 

Granted
224,000

 
$
31.79

 
 
 
 

Exercised
(5,273,000
)
 
$
31.29

 
 
 
 

Forfeited/Canceled
(2,206,000
)
 
$
48.13

 
 
 
 

Outstanding at January 28, 2017
6,987,000

 
$
36.61

 
4.3
 
$
54

Vested or expected to vest at January 28, 2017
6,987,000

 
$
36.61

 
4.3
 
$
54

Exercisable at January 28, 2017
5,858,000

 
$
36.63

 
3.5
 
$
46


 
The weighted-average grant-date fair value of stock options granted during fiscal 2017, 2016 and 2015 was $8.04, $11.59 and $9.09, respectively, per share. The aggregate intrinsic value of our stock options (the amount by which the market price of the stock on the date of exercise exceeded the exercise price of the option) exercised during fiscal 2017, 2016 and 2015, was $55 million, $14 million and $13 million, respectively. At January 28, 2017, there was $8 million of unrecognized compensation expense related to stock options that is expected to be recognized over a weighted-average period of 1.0 years.
 
Net cash proceeds from the exercise of stock options were $164 million, $40 million and $42 million in fiscal 2017, 2016 and 2015, respectively.

There was $19 million, $5 million and $5 million of income tax benefits realized from stock option exercises in fiscal 2017, 2016 and 2015, respectively.

In fiscal 2017, 2016 and 2015, we estimated the fair value of each stock option on the date of grant using a lattice or Black Scholes valuation model (for certain individuals) with the following assumptions:
Valuation Assumptions(1)
 
2017
 
2016
 
2015
Risk-free interest rate(2)
 
0.5% – 2.0%

 
0.1% – 2.1%

 
0.1% – 2.4%

Expected dividend yield
 
3.5
%
 
2.3
%
 
2.5
%
Expected stock price volatility(3)
 
37
%
 
37
%
 
40
%
Expected life of stock options (in years)(4)
 
6.0

 
6.0

 
6.0


(1)
Forfeitures are estimated using historical experience and projected employee turnover.
(2)
Based on the U.S. Treasury constant maturity interest rate whose term is consistent with the expected life of our stock options.
(3)
In projecting expected stock price volatility, we consider both the historical volatility of our stock price as well as implied volatilities from exchange-traded options on our stock.
(4)
We estimate the expected life of stock options based upon historical experience.

Market-Based Share Awards

The fair value of market-based share awards is determined using Monte-Carlo simulation. A summary of the status of our nonvested market-based share awards at January 28, 2017, and changes during fiscal 2017, is as follows:
Market-Based Share Awards
 
Shares
 
Weighted-Average Fair Value per Share
Outstanding at January 30, 2016
 
1,462,000

 
$
32.33

Granted
 
1,088,000

 
$
29.52

Vested
 
(781,000
)
 
$
26.84

Forfeited/Canceled
 
(217,000
)
 
$
33.27

Outstanding at January 28, 2017
 
1,552,000

 
$
32.99



At January 28, 2017, there was $23 million of unrecognized compensation expense related to nonvested market-based share awards that we expect to recognize over a weighted-average period of 1.7 years.

Time-Based Share Awards

The fair value of time-based share awards is determined based on the closing market price of our stock on the date of grant. This value is reduced by the present value of expected dividends during vesting when the employee is not entitled to dividends.

A summary of the status of our nonvested time-based share awards at January 28, 2017, and changes during fiscal 2017, is as follows:
Time-Based Share Awards
 
Shares
 
Weighted-Average Fair Value per Share
Outstanding at January 30, 2016
 
5,103,000

 
$
31.89

Granted
 
2,979,000

 
$
30.68

Vested
 
(2,202,000
)
 
$
30.83

Forfeited/Canceled
 
(515,000
)
 
$
32.76

Outstanding at January 28, 2017
 
5,365,000

 
$
31.57



At January 28, 2017, there was $98 million of unrecognized compensation expense related to nonvested time-based share awards that we expect to recognize over a weighted-average period of 1.7 years.

Performance-Based Share Awards

The fair value of performance-based share awards is determined based on the closing market price of our stock on the date of grant. This value is reduced by the present value of expected dividends during vesting when the employee is not entitled to dividends.

A summary of the status of our nonvested performance-based share awards at January 28, 2017, and changes during fiscal 2017, is as follows:
Performance-Based Share Awards
 
Shares
 
Weighted-Average Fair Value per Share
Outstanding at January 30, 2016
 
—

 
$
—

Granted
 
513,000

 
$
29.08

Forfeited/Canceled
 
(75,000
)
 
$
29.66

Outstanding at January 28, 2017
 
438,000

 
$
28.98



At January 28, 2017, there was $5 million of unrecognized compensation expense related to nonvested performance-based share awards that we expect to recognize over a weighted-average period of 1.8 years.

Earnings per Share

We compute our basic earnings per share based on the weighted-average number of common shares outstanding, and our diluted earnings per share based on the weighted-average number of common shares outstanding adjusted by the number of additional shares that would have been outstanding had the potentially dilutive common shares been issued. Potentially dilutive securities include stock options, nonvested share awards and shares issuable under our employee stock purchase plan. Nonvested market-based share awards and nonvested performance-based share awards are included in the average diluted shares outstanding each period if established market or performance criteria have been met at the end of the respective periods.

At January 28, 2017, options to purchase 7.0 million shares of common stock were outstanding as follows (shares in millions):
 
Exercisable
 
Unexercisable
 
Total
 
Shares
 
%
 
Weighted-
Average Price
per Share
 
Shares
 
%
 
Weighted-
Average Price
per Share
 
Shares
 
%
 
Weighted-
Average Price
per Share
In-the-money
2.3

 
39
%
 
$
26.38

 
0.5

 
45
%
 
$
30.84

 
2.8

 
40
%
 
$
27.13

Out-of-the-money
3.6

 
61
%
 
$
43.45

 
0.6

 
55
%
 
$
40.66

 
4.2

 
60
%
 
$
43.01

Total
5.9

 
100
%
 
$
36.64

 
1.1

 
100
%
 
$
36.54

 
7.0

 
100
%
 
$
36.61



The computation of dilutive shares outstanding excludes the out-of-the-money stock options because such outstanding options' exercise prices were greater than the average market price of our common shares and, therefore, the effect would be anti-dilutive (i.e., including such options would result in higher earnings per share).

The following table presents a reconciliation of the numerators and denominators of basic and diluted earnings per share from continuing operations attributable to Best Buy Co., Inc. in fiscal 2017, 2016 and 2015 ($ and shares in millions, except per share amounts):
 
2017
 
2016
 
2015
Numerator (in millions):
 
 
 
 
 
Net earnings from continuing operations attributable to Best Buy Co., Inc., shareholders
$
1,207

 
$
807

 
$
1,246

Denominator (in millions):
 
 
 
 
 
Weighted-average common shares outstanding
318.5

 
346.5

 
349.5

Effect of potentially dilutive securities:
 
 
 
 
 
Stock options and other
4.1

 
4.2

 
4.1

Weighted-average common shares outstanding, assuming dilution
322.6

 
350.7

 
353.6

Net earnings per share from continuing operations attributable to Best Buy Co., Inc. shareholders
 
 
 
 
 
Basic
$
3.79

 
$
2.33

 
$
3.57

Diluted
$
3.74

 
$
2.30

 
$
3.53



Repurchase of Common Stock
 
In June 2011, our Board of Directors authorized a $5.0 billion share repurchase program. There is no expiration date governing the period over which we can repurchase shares under the June 2011 share repurchase program.

On January 22, 2016, we entered into a variable notional accelerated share repurchase agreement ("January 2016 ASR") with a third party financial institution to repurchase $150 million to $175 million of our common stock. Under the agreement, we paid $175 million at the beginning of the contract and received an initial delivery of 4.4 million shares on January 25, 2016. We retired these shares and recorded a $120 million reduction to stockholders' equity. As of January 30, 2016, the remaining $55 million was included as a reduction of stockholders' equity as prepaid share repurchase on our Consolidated Balance Sheets. The January 2016 ASR was settled on February 17, 2016, for a final notional amount of $165 million. Accordingly we received 1.6 million shares, which were retired, and a $10 million cash payment from our counter-party equal to the difference between the $175 million up-front payment and the final notional amount. The cash received was included as other, net within financing activities on our Consolidated Statements of Cash Flow. The final notional amount was determined based upon the volume-weighted average share price of our common stock during the term of the January 2016 ASR agreement. The number of shares delivered was based upon the final notional amount and the volume-weighted average share price of our common stock during the term of the agreement, less an agreed-upon discount.

The following table presents information regarding the shares we repurchased and retired in fiscal 2017 and 2016, noting that we had no repurchases and retirements in fiscal 2015 ($ and shares in millions, except per share amounts):
 
2017
 
2016
Total cost of shares repurchased
 
 
 
Open market(1)
$
706

 
$
880

January 2016 ASR
45

 
120

     Total
$
751

 
$
1,000

 
 
 
 
Average price per share
 
 
 
Open market
$
36.11

 
$
31.03

January 2016 ASR
$
28.55

 
$
27.28

     Average
$
35.54

 
$
30.53

 
 
 
 
Number of shares repurchased and retired
 
 
 
Open market(1)
19.5

 
28.4
January 2016 ASR
1.6

 
4.4
     Total
21.1

 
32.8

(1)
As of January 28, 2017, $8 million, or 0.1 million shares, in trades remained unsettled. The liability for unsettled trades is included in accrued liabilities in the Consolidated Balance Sheets.

At January 28, 2017, $2.2 billion remained available for additional purchases under the June 2011 share repurchase program. In February 2017, our Board of Directors authorized a new $5.0 billion share repurchase plan, which supersedes the June 2011 share repurchase program. There is no expiration date governing the period over which we can repurchase shares under the February 2017 share repurchase program. Repurchased shares have been retired and constitute authorized but unissued shares.
 
Comprehensive Income (Loss)
 
Comprehensive income (loss) is computed as net earnings plus certain other items that are recorded directly to shareholders' equity. In addition to net earnings, the significant components of comprehensive income (loss) include foreign currency translation adjustments and unrealized gains and losses, net of tax, on available-for-sale marketable equity securities. Foreign currency translation adjustments do not include a provision for income tax expense when earnings from foreign operations are considered to be indefinitely reinvested outside the U.S.

The following table provides a reconciliation of the components of accumulated other comprehensive income, net of tax, attributable to Best Buy Co., Inc. shareholders for fiscal 2017, 2016, and 2015, respectively ($ in millions):
 
Foreign Currency Translation
 
Available-For-Sale Investments(1)
 
Total
Balances at February 1, 2014
$
485

 
$
7

 
$
492

Foreign currency translation adjustments
(103
)
 
—

 
(103
)
Unrealized gains on available-for-sale investments
—

 
(3
)
 
(3
)
Reclassification of losses on available-for-sale investments into earnings
—

 
(4
)
 
(4
)
Balances at January 31, 2015
382

 
—

 
382

Foreign currency translation adjustments
(44
)
 
—

 
(44
)
Reclassification of foreign currency translation adjustments into earnings due to sale of business
(67
)
 
—

 
(67
)
Balances at January 30, 2016
271

 
—

 
271

Foreign currency translation adjustments
10

 
—

 
10

Reclassification of foreign currency translation adjustments into earnings
(2
)
 
—

 
(2
)
Balances at January 28, 2017
$
279

 
$
—

 
$
279


(1)
There were no material tax impacts to gains or losses on available-for-sale investments in the periods presented.
Leases
Leases
Leases

The composition of net rent expense for all operating leases, including leases of property and equipment, was as follows in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Minimum rentals
$
789

 
$
797

 
$
848

Contingent rentals
1

 
1

 
2

Total rent expense
790

 
798

 
850

Less: sublease income
(16
)
 
(15
)
 
(18
)
Net rent expense
$
774

 
$
783

 
$
832



The future minimum lease payments under our capital, financing and operating leases by fiscal year (not including contingent rentals) at January 28, 2017, were as follows ($ in millions):
Fiscal Year
 
Capital
Leases
 
Financing
Leases
 
Operating
Leases(1)
2018
 
$
9

 
$
46

 
$
803

2019
 
7

 
41

 
676

2020
 
4

 
35

 
546

2021
 
3

 
28

 
411

2022
 
2

 
20

 
285

Thereafter
 
11

 
56

 
404

Total minimum lease payments
 
36

 
226

 
$
3,125

Less amount representing interest
 
(6
)
 
(49
)
 
 
Present value of minimum lease payments
 
30

 
177

 
 
Less current maturities
 
(8
)
 
(36
)
 
 

Present value of minimum lease payments, less current maturities
 
$
22

 
$
141

 
 


(1)
Operating lease obligations do not include payments to landlords covering real estate taxes and common area maintenance. These charges, if included, would increase total operating lease obligations by $1.0 billion at January 28, 2017.

Total minimum lease payments have not been reduced by minimum sublease rent income of approximately $79 million due under future noncancelable subleases.
Benefit Plans
Benefit Plans
Benefit Plans

We sponsor retirement savings plans for employees meeting certain eligibility requirements. Participants may choose from various investment options, including a fund comprised of our company stock. Participants can contribute up to 50% of their eligible compensation annually as defined by the plan document, subject to Internal Revenue Service limitations. We match 100% of the first 3% of participating employees' contributions and 50% of the next 2%. Employer contributions vest immediately. The total employer contributions were $56 million, $53 million and $60 million in fiscal 2017, 2016 and 2015, respectively.

We have a non-qualified, unfunded deferred compensation plan for highly compensated employees and members of our Board of Directors. Amounts contributed and deferred under our deferred compensation plan are credited or charged with the performance of investment options offered under the plan and elected by the participants. In the event of bankruptcy, the assets of the plan are available to satisfy the claims of general creditors. The liability for compensation deferred under the plan was $31 million and $34 million at January 28, 2017, and January 30, 2016, respectively, and is included in long-term liabilities. We manage the risk of changes in the fair value of the liability for deferred compensation by electing to match our liability under the plan with investment vehicles that offset a substantial portion of our exposure. The fair value of the investment vehicles, which includes funding for future deferrals, was $96 million and $96 million at January 28, 2017, and January 30, 2016, respectively, and is included in other assets.
Income Taxes
Income Taxes
Income Taxes

The following is a reconciliation of the federal statutory income tax rate to income tax expense in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Federal income tax at the statutory rate
$
635

 
$
458

 
$
485

State income taxes, net of federal benefit
38

 
38

 
43

(Benefit) expense from foreign operations
(46
)
 
5

 
(23
)
Other
(18
)
 
2

 
(11
)
Legal entity reorganization
—

 
—

 
(353
)
Income tax expense
$
609

 
$
503

 
$
141

Effective income tax rate
33.5
%
 
38.4
%
 
10.1
%

Legal Entity Reorganization

In the fourth quarter of fiscal 2012, we purchased Carphone Warehouse Group plc's interest in the Best Buy Mobile profit share agreement for $1.3 billion (the “Mobile buy-out”). The Mobile buy-out completed by our U.K. subsidiary resulted in the $1.3 billion purchase price being assigned, for U.S. tax purposes only, to an intangible asset. The Mobile buy-out did not, however, result in a similar intangible asset in the U.K., as the Mobile buy-out was considered part of a tax-free equity transaction for U.K. tax purposes.

Because the U.S. tax basis in the intangible asset was considered under U.S. tax law to be held by our U.K. subsidiary, which was regarded as a foreign corporation for U.S. tax purposes, Accounting Standards Codification ("ASC") 740, Income Taxes, requires that no deferred tax asset may be recorded in respect of the intangible asset. ASC 740-30-25-9 also precludes the recording of a deferred tax asset on the outside basis difference of the U.K. subsidiary. As a result, the amortization of the U.S. tax basis in the intangible asset only resulted in a periodic income tax benefit by reducing the amount of the U.K. subsidiary’s income, if any, that would otherwise have been subject to U.S. income taxes.

In the first quarter of fiscal 2015, we filed an election with the Internal Revenue Service to treat the U.K. subsidiary as a disregarded entity such that its assets are now deemed to be assets held directly by a U.S. entity for U.S. tax purposes. This tax-only election, which resulted in the liquidation of the U.K. subsidiary for U.S. tax purposes, resulted in the elimination of our outside basis difference in the U.K. subsidiary. Additionally, the election resulted in the recognition of a deferred tax asset (and corresponding income tax benefit) for the remaining unrecognized inside tax basis in the intangible, in a manner similar to a change in tax status as provided in ASC 740-10-25-32.

Earnings from continuing operations before income tax expense by jurisdiction was as follows in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
United States
$
1,507

 
$
1,310

 
$
1,201

Outside the United States
309

 
—

 
186

Earnings from continuing operations before income tax expense
$
1,816

 
$
1,310

 
$
1,387



Income tax expense was comprised of the following in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Current:
 
 
 
 
 
Federal
$
317

 
$
347

 
$
354

State
37

 
48

 
51

Foreign
54

 
60

 
33

 
408

 
455

 
438

Deferred:
 
 
 
 
 
Federal
163

 
65

 
(275
)
State
21

 
10

 
(26
)
Foreign
17

 
(27
)
 
4

 
201

 
48

 
(297
)
Income tax expense
$
609

 
$
503

 
$
141



Deferred taxes are the result of differences between the bases of assets and liabilities for financial reporting and income tax purposes. Deferred tax assets and liabilities were comprised of the following ($ in millions):
 
January 28, 2017
 
January 30, 2016
Accrued property expenses
$
91

 
$
175

Other accrued expenses
76

 
78

Deferred revenue
104

 
99

Compensation and benefits
43

 
99

Stock-based compensation
64

 
86

Goodwill and intangibles
210

 
253

Loss and credit carryforwards
123

 
133

Other
59

 
86

Total deferred tax assets
770

 
1,009

Valuation allowance
(94
)
 
(108
)
Total deferred tax assets after valuation allowance
676

 
901

Property and equipment
(240
)
 
(296
)
Inventory
(97
)
 
(69
)
Other
(22
)
 
(26
)
Total deferred tax liabilities
(359
)
 
(391
)
Net deferred tax assets
$
317

 
$
510



Net deferred tax assets are included in our Consolidated Balance Sheets as other assets as of January 28, 2017, and January 30, 2016.

At January 28, 2017, we had total net operating loss carryforwards from international operations of $77 million, of which $70 million will expire in various years through 2036 and the remaining amounts have no expiration. Additionally, we had acquired U.S. federal net operating loss carryforwards of $17 million, which expire between 2023 and 2030; U.S. federal foreign tax credit carryforwards of $1 million, which expire between 2023 and 2026; U.S. federal capital loss carryforwards of $3 million, which expire in 2022; state credit carryforwards of $10 million, which expire in 2024; state capital loss carryforwards of $5 million, which expire in 2019; international credit carryforwards of $2 million, which have no expiration; and international capital loss carryforwards of $8 million, which have no expiration.

At January 28, 2017, a valuation allowance of $94 million had been established, of which $1 million is against U.S. federal foreign tax credit carryforwards; $16 million is against international, U.S. federal and state capital loss carryforwards; $7 million is against state credit carryforwards and other state deferred tax assets; and $70 million is against certain international net operating loss carryforwards and other international deferred tax assets. The $14 million decrease from January 30, 2016, is primarily due to the exchange rate impact on the valuation allowance against certain international net operating loss carryforwards.

We have not provided deferred taxes on unremitted earnings attributable to foreign operations that have been considered to be reinvested indefinitely. These earnings relate to ongoing operations and were $1.1 billion at January 28, 2017. It is not practicable to determine the income tax liability that would be payable if such earnings were not indefinitely reinvested.

The following table provides a reconciliation of changes in unrecognized tax benefits for fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Balance at beginning of period
$
469

 
$
410

 
$
370

Gross increases related to prior period tax positions
11

 
30

 
33

Gross decreases related to prior period tax positions
(144
)
 
(13
)
 
(88
)
Gross increases related to current period tax positions
55

 
59

 
114

Settlements with taxing authorities
(12
)
 
(9
)
 
(9
)
Lapse of statute of limitations
(5
)
 
(8
)
 
(10
)
Balance at end of period
$
374

 
$
469

 
$
410



Unrecognized tax benefits of $346 million, $337 million and $297 million at January 28, 2017, January 30, 2016, and January 31, 2015, respectively, would favorably impact our effective income tax rate if recognized.

We recognize interest and penalties (not included in the "unrecognized tax benefits" above), as well as interest received from favorable tax settlements, as components of income tax expense. Interest income of $9 million was recognized in fiscal 2017. At January 28, 2017, January 30, 2016, and January 31, 2015, we had accrued interest of $61 million, $89 million and $78 million, respectively, along with accrued penalties of $1 million, $1 million and $2 million at January 28, 2017, January 30, 2016, and January 31, 2015, respectively.

We file a consolidated U.S. federal income tax return, as well as income tax returns in various states and foreign jurisdictions. With few exceptions, we are no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before fiscal 2007.

Because existing tax positions will continue to generate increased liabilities for us for unrecognized tax benefits over the next 12 months, and since we are routinely under audit by various taxing authorities, it is reasonably possible that the amount of unrecognized tax benefits will change during the next 12 months. An estimate of the amount or range of such change cannot be made at this time. However, we do not expect the change, if any, to have a material effect on our consolidated financial condition, results of operations or cash flows within the next 12 months.
Segments and Geographic Information
Segment and Geographic Information
Segment and Geographic Information
 
Segment Information
 
Our chief operating decision maker ("CODM") is our Chief Executive Officer. Our business is organized into two reportable segments: Domestic (which is comprised of all operations within the U.S. and its territories) and International (which is comprised of all operations outside the U.S. and its districts and territories). Our CODM has ultimate responsibility for enterprise decisions. Our CODM determines, in particular, resource allocation for, and monitors performance of, the consolidated enterprise, the Domestic segment and the International segment. The Domestic segment managers and International segment managers have responsibility for operating decisions, allocating resources and assessing performance within their respective segments. Our CODM relies on internal management reporting that analyzes enterprise results to the net earnings level and segment results to the operating income level.
 
We aggregate our Canada and Mexico businesses into one International operating segment. Our Domestic and International operating segments also represent our reportable segments. The accounting policies of the segments are the same as those described in Note 1, Summary of Significant Accounting Policies.
The following tables present our business segment information in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Revenue
 
 
 
 
 
Domestic
$
36,248

 
$
36,365

 
$
36,055

International
3,155

 
3,163

 
4,284

Total revenue
$
39,403

 
$
39,528

 
$
40,339

Percentage of revenue, by revenue category
 
 
 
 
 
Domestic
 
 
 
 
 
Consumer Electronics
34
%
 
32
%
 
31
%
Computing and Mobile Phones
45
%
 
46
%
 
47
%
Entertainment
7
%
 
8
%
 
9
%
Appliances
9
%
 
8
%
 
7
%
Services
5
%
 
5
%
 
5
%
Other
—
%
 
1
%
 
1
%
Total
100
%
 
100
%
 
100
%
International
 
 
 
 
 
Consumer Electronics
31
%
 
31
%
 
30
%
Computing and Mobile Phones
48
%
 
48
%
 
49
%
Entertainment
7
%
 
9
%
 
9
%
Appliances
6
%
 
5
%
 
5
%
Services
7
%
 
6
%
 
6
%
Other
1
%
 
1
%
 
1
%
Total
100
%
 
100
%
 
100
%
Operating income (loss)
 
 
 
 
 
Domestic(1)
$
1,764

 
$
1,585

 
$
1,437

International
90

 
(210
)
 
13

Total operating income
1,854

 
1,375

 
1,450

Other income (expense)
 
 
 
 
 
Gain on sale of investments
3

 
2

 
13

Investment income and other
31

 
13

 
14

Interest expense
(72
)
 
(80
)
 
(90
)
Earnings from continuing operations before income tax expense
$
1,816

 
$
1,310

 
$
1,387

Assets(2)
 
 
 
 
 
Domestic
$
12,496

 
$
12,318

 
$
12,987

International
1,360

 
1,201

 
2,258

Total assets
$
13,856

 
$
13,519

 
$
15,245

Capital expenditures(2)
 
 
 
 
 
Domestic
$
526

 
$
602

 
$
519

International
56

 
47

 
42

Total capital expenditures
$
582

 
$
649

 
$
561

Depreciation(2)
 
 
 
 
 
Domestic
$
613

 
$
613

 
$
575

International
41

 
44

 
81

Total depreciation
$
654

 
$
657

 
$
656


(1) The Domestic segment operating income includes certain operations, which are based in foreign tax jurisdictions and primarily relate to sourcing products into the U.S.    
(2) For fiscal 2015, the International segment amounts for assets, capital expenditures and depreciation include amounts from Five Star.

Geographic Information

The following table presents our geographic information in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Net sales to customers
 
 
 
 
 
United States
$
36,248

 
$
36,365

 
$
36,055

Canada
2,899

 
2,917

 
4,047

Other
256

 
246

 
237

Total revenue
$
39,403

 
$
39,528

 
$
40,339

Long-lived assets
 
 
 
 
 
United States
$
2,120

 
$
2,189

 
$
2,100

Canada
156

 
140

 
174

Other
17

 
17

 
21

Total long-lived assets
$
2,293

 
$
2,346

 
$
2,295

Contingencies and Commitments
Contingencies and Commitments
Contingencies and Commitments

Contingencies

We are involved in a number of legal proceedings. Where appropriate, we have made accruals with respect to these matters, which are reflected in our Consolidated Financial Statements. However, there are cases where liability is not probable or the amount cannot be reasonably estimated and, therefore, accruals have not been made. We provide disclosure of matters where we believe it is reasonably possible the impact may be material to our Consolidated Financial Statements.

Securities Actions
 
In February 2011, a purported class action lawsuit captioned, IBEW Local 98 Pension Fund, individually and on behalf of all others similarly situated v. Best Buy Co., Inc., et al., was filed against us and certain of our executive officers in the U.S. District Court for the District of Minnesota. This federal court action alleges, among other things, that we and the officers named in the complaint violated Sections 10(b) and 20A of the Exchange Act and Rule 10b-5 under the Exchange Act in connection with press releases and other statements relating to our fiscal 2011 earnings guidance that had been made available to the public. Additionally, in March 2011, a similar purported class action was filed by a single shareholder, Rene LeBlanc, against us and certain of our executive officers in the same court. In July 2011, after consolidation of the IBEW Local 98 Pension Fund and Rene LeBlanc actions, a consolidated complaint captioned, IBEW Local 98 Pension Fund v. Best Buy Co., Inc., et al., was filed and served. We filed a motion to dismiss the consolidated complaint in September 2011, and in March 2012, subsequent to the end of fiscal 2012, the court issued a decision dismissing the action with prejudice. In April 2012, the plaintiffs filed a motion to alter or amend the court's decision on our motion to dismiss. In October 2012, the court granted plaintiff's motion to alter or amend the court's decision on our motion to dismiss in part by vacating such decision and giving plaintiff leave to file an amended complaint, which plaintiff did in October 2012. We filed a motion to dismiss the amended complaint in November 2012 and all responsive pleadings were filed in December 2012. A hearing was held on April 26, 2013. On August 5, 2013, the court issued an order granting our motion to dismiss in part and, contrary to its March 2012 order, denying the motion to dismiss in part, holding that certain of the statements alleged to have been made were not forward-looking statements and therefore were not subject to the “safe-harbor” provisions of the Private Securities Litigation Reform Act. Plaintiffs moved to certify the purported class. By Order filed August 6, 2014, the court certified a class of persons or entities who acquired Best Buy common stock between 10:00 a.m. EDT on September 14, 2010, and December 13, 2010, and who were damaged by the alleged violations of law. The 8th Circuit Court of Appeals granted our request for interlocutory appeal. On April 12, 2016, the 8th Circuit held the trial court misapplied the law and reversed the class certification order. IBEW petitioned the 8th Circuit for a rehearing en banc, which was denied on June 1, 2016. In October 2016, IBEW advised the trial court it will not seek review by the Supreme Court.  The trial court held a January 2017 conference during which the parties were asked to submit briefs on their respective interpretations of the 8th Circuit Decision. Briefing is complete and we await a ruling as to the next phase of proceedings before the trial court. We continue to believe that these allegations are without merit and intend to vigorously defend our company in this matter.
 
In June 2011, a purported shareholder derivative action captioned, Salvatore M. Talluto, Derivatively and on Behalf of Best Buy Co., Inc. v. Richard M. Schulze, et al., as Defendants and Best Buy Co., Inc. as Nominal Defendant, was filed against both present and former members of our Board of Directors serving during the relevant periods in fiscal 2011 and us as a nominal defendant in the U.S. District Court for the State of Minnesota. The lawsuit alleges that the director defendants breached their fiduciary duty, among other claims, including violation of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, in failing to correct public misrepresentations and material misstatements and/or omissions regarding our fiscal 2011 earnings projections and, for certain directors, selling stock while in possession of material adverse non-public information. Additionally, in July 2011, a similar purported class action was filed by a single shareholder, Daniel Himmel, against us and certain of our executive officers in the same court. In November 2011, the respective lawsuits of Salvatore M. Talluto and Daniel Himmel were consolidated into a new action captioned, In Re: Best Buy Co., Inc. Shareholder Derivative Litigation, and a stay ordered pending the close of discovery in the consolidated IBEW Local 98 Pension Fund v. Best Buy Co., Inc., et al. case. Additionally, in June 2015, a similar purported class action was filed by a single shareholder, Khuong Tran, derivatively on behalf of Best Buy Co., Inc. against us and certain of our executive officers and directors in the same court. The Khuong Tran lawsuit has also been stayed pending the close of discovery in IBEW.

The plaintiffs in the above securities actions seek damages, including interest, equitable relief and reimbursement of the costs and expenses they incurred in the lawsuits. As stated above, we believe the allegations in the above securities actions are without merit, and we intend to defend these actions vigorously. Based on our assessment of the facts underlying the claims in the above securities actions, their respective procedural litigation history and the degree to which we intend to defend our company in these matters, the amount or range of reasonably possible losses, if any, cannot be estimated.

Cathode Ray Tube Action

On November 14, 2011, we filed a lawsuit captioned In re Cathode Ray Tube Antitrust Litigation in the United States District Court for the Northern District of California. We alleged that the defendants engaged in price fixing in violation of antitrust regulations relating to cathode ray tubes for the time period between March 1, 1995, through November 25, 2007. In connection with this action, we received settlement proceeds, net of legal expenses and costs, in the amount of $77 million during fiscal 2016. In the first quarter of fiscal 2017, we settled with the remaining defendants for $161 million, net of legal expenses and costs, which have been fully paid as of January 28, 2017. Settlement proceeds were recognized in cost of goods sold with the associated legal expenses recorded in SG&A. This matter is now resolved.

Other Legal Proceedings
 
We are involved in various other legal proceedings arising in the normal course of conducting business. For such legal proceedings, we have accrued an amount that reflects the aggregate liability deemed probable and estimable, but this amount is not material to our consolidated financial position, results of operations or cash flows. Because of the preliminary nature of many of these proceedings, the difficulty in ascertaining the applicable facts relating to many of these proceedings, the variable treatment of claims made in many of these proceedings and the difficulty of predicting the settlement value of many of these proceedings, we are not able to estimate an amount or range of any reasonably possible additional losses. However, based upon our historical experience, the resolution of these proceedings is not expected to have a material effect on our consolidated financial position, results of operations or cash flows.

Commitments

We had outstanding letters of credit with an aggregate fair value of $89 million at January 28, 2017.
Supplementary Financial Information (Unaudited)
Supplementary Financial Information (Unaudited)
Quarterly Financial Information (Unaudited)

The following tables show selected operating results for each 3-month quarter and full year of fiscal 2017 and 2016 (unaudited) ($ in millions):
 
Quarter
 
12-Month
 
1st
 
2nd
 
3rd
 
4th
 
2017
Revenue
$
8,443

 
$
8,533

 
$
8,945

 
$
13,482

 
$
39,403

Comparable sales % change(1)
(0.1
)%
 
0.8
%
 
1.8
%
 
(0.7
)%
 
0.3
%
Gross profit(2)
$
2,145

 
$
2,062

 
$
2,203

 
$
3,030

 
$
9,440

Operating income(3)
372

 
289

 
312

 
881

 
1,854

Net earnings from continuing operations
226

 
182

 
192

 
607

 
1,207

Gain from discontinued operations, net of tax
3

 
16

 
2

 
—

 
21

Net earnings attributable to Best Buy Co., Inc. shareholders
229

 
198

 
194

 
607

 
1,228

Diluted earnings per share(4)
 
 
 
 
 
 
 
 
 
Continuing operations
$
0.69

 
$
0.56

 
$
0.60

 
$
1.91

 
$
3.74

Discontinued operations
0.01

 
0.05

 
0.01

 
—

 
0.07

Diluted earnings per share
$
0.70

 
$
0.61

 
$
0.61

 
$
1.91

 
$
3.81

 
Quarter
 
12-Month
 
1st
 
2nd
 
3rd
 
4th
 
2016
Revenue
$
8,558

 
$
8,528

 
$
8,819

 
$
13,623

 
$
39,528

Comparable sales % change(1)
0.6
%
 
3.8
%
 
0.8
%
 
(1.7
)%
 
0.5
%
Gross profit(5)
$
2,030

 
$
2,098

 
$
2,112

 
$
2,951

 
$
9,191

Operating income(6)
86

 
288

 
230

 
771

 
1,375

Net earnings from continuing operations
37

 
164

 
129

 
477

 
807

Gain (loss) from discontinued operations, net of tax
92

 
—

 
(4
)
 
2

 
90

Net earnings attributable to Best Buy Co., Inc. shareholders
129

 
164

 
125

 
479

 
897

Diluted earnings (loss) per share(4)
 
 
 
 
 
 
 
 
 
Continuing operations
$
0.10

 
$
0.46

 
$
0.37

 
$
1.39

 
$
2.30

Discontinued operations
0.26

 
—

 
(0.01
)
 
0.01

 
0.26

Diluted earnings per share
$
0.36

 
$
0.46

 
$
0.36

 
$
1.40

 
$
2.56

(1)
Our comparable sales calculation compares revenue from stores, websites and call centers operating for at least 14 full months, as well as revenue related to certain other comparable sales channels for a particular period to the corresponding period in the prior year. Relocated stores, as well as remodeled, expanded and downsized stores closed more than 14 days, are excluded from our comparable sales calculation until at least 14 full months after reopening. Acquisitions are included in the comparable sales calculation beginning with the first full quarter following the first anniversary of the date of the acquisition. The Canadian brand consolidation, which included the permanent closure of 66 Future Shop stores, the conversion of 65 Future Shop stores to Best Buy stores and the elimination of the Future Shop website, had a material impact on a year-over-year basis on the remaining Canadian retail stores and the website. As such, from the first quarter of fiscal 2016 through the third quarter of fiscal 2017, all Canadian store and website revenue was removed from the comparable sales base and the International segment no longer had a comparable metric. Therefore, Consolidated comparable sales equaled the Domestic segment comparable sales. Beginning in the fourth quarter of fiscal 2017, we resumed reporting International comparable sales as revenue in the International segment was once again deemed to be comparable and, as such, Consolidated comparable sales are once again equal to the aggregation of Domestic and International comparable sales.
(2)
Includes $183 million of cathode ray tube ("CRT") litigation settlements reached and recorded in the fiscal first quarter and $183 million for the 12 months ended January 28, 2017, related to products purchased and sold in prior fiscal years.
(3)
Includes $29 million, $0 million, $1 million and $9 million of restructuring charges recorded in the fiscal first, second, third and fourth quarters, respectively, and $39 million for the 12 months ended January 28, 2017, related to measures we took to restructure our businesses. Also, includes $161 million of cathode ray tube litigation settlements, net of related legal fees and costs, recorded in the fiscal first quarter and in the 12 months ended January 28, 2017, related to products purchased and sold in prior fiscal years.
(4)
The sum of our quarterly diluted earnings per share does not equal our annual diluted earnings per share due to differences in quarterly and annual weighted-average shares outstanding.
(5)
Includes $78 million, $10 million, $0 million and $2 million of CRT and LCD litigation settlements reached and recorded in the fiscal first, second, third and fourth quarters respectively, and $90 million for the 12 months ended January 30, 2016, related to products purchased and sold in prior fiscal years.
(6)
Includes $186 million, $(4) million, $7 million and $12 million of restructuring charges recorded in the fiscal first, second, third and fourth quarters, respectively, and $201 million for the 12 months ended January 30, 2016, related to measures we took to restructure our businesses. Also, includes $67 million, $8 million, $0 million and $2 million of CRT and LCD litigation settlements, net of related legal fees and costs, recorded in the fiscal first, second, third and fourth quarters respectively, and $77 million for the 12 months ended January 30, 2016, related to products purchased and sold in prior fiscal years.
Valuation and Qualifying Accounts
Valuation and Qualifying Accounts
Schedule II

Valuation and Qualifying Accounts
($ in millions)
 
Balance at
Beginning
of Period
 
Charged to
Expenses or
Other Accounts
 
Other(1)
 
Balance at
End of
Period
Year ended January 28, 2017
 
 
 
 
 
 
 
Allowance for doubtful accounts
$
49

 
$
44

 
$
(41
)
 
$
52

Year ended January 30, 2016
 
 
 
 
 
 
 
Allowance for doubtful accounts
$
59

 
$
30

 
$
(40
)
 
$
49

Year ended January 31, 2015
 
 
 
 
 
 
 
Allowance for doubtful accounts
$
104

 
$
1

 
$
(46
)
 
$
59

(1)
Includes bad debt write-offs and recoveries, acquisitions and the effect of foreign currency fluctuations.
Summary of Significant Accounting Policies (Policies)
Discontinued Operations 
Discontinued Operations

On February 13, 2015, we sold Jiangsu Five Star Appliance Co., Limited ("Five Star"). The results of Five Star are presented as discontinued operations for all periods. See Note 2, Discontinued Operations, for further information.
Description of Business 
Description of Business

We are a leading provider of technology products, services and solutions. We offer these products and services to the customers who visit our stores, engage with Geek Squad agents or use our websites or mobile applications. We have operations in the U.S., Canada and Mexico. We have two reportable segments: Domestic and International. The Domestic segment is comprised of the operations in all states, districts and territories of the U.S., under various brand names including Best Buy, bestbuy.com, Best Buy Mobile, Best Buy Direct, Best Buy Express, Geek Squad, Magnolia Home Theater and Pacific Kitchen and Home. The International segment is comprised of all operations in Canada and Mexico under the brand names Best Buy, bestbuy.com.ca, bestbuy.com.mx, Best Buy Express, Best Buy Mobile and Geek Squad.
Basis of Presentation 
Basis of Presentation

The consolidated financial statements include the accounts of Best Buy Co., Inc. and its consolidated subsidiaries. All intercompany balances and transactions are eliminated upon consolidation.

In order to align our fiscal reporting periods and comply with statutory filing requirements, we consolidate the financial results of our Mexico operations on a one-month lag. Our policy is to accelerate recording the effect of events occurring in the lag period that significantly affect our consolidated financial statements. No significant intervening event occurred in these operations that would have materially affected our financial condition, results of operations, liquidity or other factors had it been recorded during fiscal 2017, 2016 or 2015.

In preparing the accompanying consolidated financial statements, we evaluated the period from January 28, 2017, through the date the financial statements were issued for material subsequent events requiring recognition or disclosure. Other than as described in Note 7, Shareholders' Equity, no such events were identified for this period.
Use of Estimates in the Preparation of Financial Statements 
Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with accounting principles generally accepted in the U.S. ("GAAP") requires us to make estimates and assumptions. These estimates and assumptions affect the reported amounts in the consolidated financial statements, as well as the disclosure of contingent liabilities. Future results could be materially affected if actual results were to differ from these estimates and assumptions.
Fiscal Period 
Fiscal Year

Our fiscal year ends on the Saturday nearest the end of January. Fiscal 2017, 2016 and 2015 each included 52 weeks.

New Accounting Pronouncements 
New Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers. The new guidance establishes a single comprehensive model for entities to use in accounting for revenue and supersedes most current revenue recognition guidance. It introduces a five-step process for revenue recognition that focuses on transfer of control, as opposed to transfer of risk and rewards under current guidance. It also requires significantly expanded disclosures regarding revenues.

Based on our preliminary assessment, we believe the impact of adopting the new guidance will be immaterial to our annual and interim financial statements. We believe that the impact will be limited to minor changes to the timing of recognition of revenues related to gift cards and loyalty programs.
We plan to adopt this standard in the first quarter of our fiscal 2019, using the modified retrospective method. Under this method, we will recognize the cumulative effect of the changes in retained earnings at the date of adoption, but will not restate prior periods.

In July 2015, the FASB issued ASU 2015-11, Inventory: Simplifying the Measurement of Inventory. The new guidance replaces the current inventory measurement requirement of lower of cost or market with the lower of cost or net realizable value. Based on the effective dates, we will prospectively adopt this standard in the first quarter of our fiscal 2018. We do not expect a material impact to our financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases. The new guidance was issued to increase transparency and comparability among companies by requiring most leases to be included on the balance sheet and by expanding disclosure requirements. Based on the effective dates, we expect to adopt the new guidance in the first quarter of fiscal 2020 using the modified retrospective method. While we expect adoption to lead to a material increase in the assets and liabilities recorded on our balance sheet, we are still evaluating the overall impact on our financial statements.

In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting. The new guidance changes certain aspects of accounting for share-based payments including accounting for income taxes, forfeitures and classifications in the statement of cash flows. We plan to adopt this standard in the first quarter of fiscal 2018, which aligns with the required adoption date. As allowed by ASU 2016-09, we plan to change our accounting for forfeitures from our current method of estimating the number of awards that are expected to vest to recording forfeitures as they occur. This will require a cumulative-effect adjustment to equity as of the beginning of fiscal 2018. We do not expect this adjustment to be material to our financial statements. In addition, we do not expect the remaining changes caused by ASU 2016-09 to have a material impact to our financial statements.

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments, and in November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows: Restricted Cash. ASU 2016-15 provides classification requirements for specific transactions within the statement of cash flows, while ASU 2016-18 requires restricted cash balances be included in the beginning and ending cash balance within the statement of cash flows. We plan to retrospectively adopt these standards in the first quarter of our fiscal 2018, which is one year earlier than required. The adoption will increase our beginning and ending cash balance within our statement of cash flows by our restricted cash balances (see Restricted Assets section below) and will require a new disclosure to reconcile the cash balances within our statement of cash flows to the balance sheets. We do not expect any other material impacts to our financial statements.

Cash and Cash Equivalents 
Cash and Cash Equivalents

Cash primarily consists of cash on hand and bank deposits. Cash equivalents consist of money market funds, commercial paper, corporate bonds and time deposits with an original maturity of 3 months or less when purchased. The amounts of cash equivalents at January 28, 2017, and January 30, 2016, were $1,531 million and $1,208 million, respectively, and the weighted-average interest rates were 0.5% and 0.5%, respectively.

Receivables 
Receivables

Receivables consist principally of amounts due from mobile phone network operators for device sales and commissions; banks for customer credit card and debit card transactions; and vendors for various vendor funding programs.

We establish allowances for uncollectible receivables based on historical collection trends and write-off history. Our allowances for uncollectible receivables were $52 million and $49 million at January 28, 2017, and January 30, 2016, respectively.

Merchandise Inventories 
Merchandise Inventories

Merchandise inventories are recorded at the lower of cost, using the average cost, or market. In-bound freight-related costs from our vendors are included as part of the net cost of merchandise inventories. Also included in the cost of inventory are certain vendor allowances that are not a reimbursement of specific, incremental and identifiable costs to promote a vendor's products. Other costs associated with acquiring, storing and transporting merchandise inventories to our retail stores are expensed as incurred and included in cost of goods sold.

Our inventory valuation reflects adjustments for anticipated physical inventory losses (e.g., theft) that have occurred since the last physical inventory. Physical inventory counts are taken on a regular basis to ensure that the inventory reported in our consolidated financial statements is properly stated.

Our inventory valuation also reflects markdowns for the excess of the cost over the amount we expect to realize from the ultimate sale or other disposal of the inventory. Markdowns establish a new cost basis for our inventory. Subsequent changes in facts or circumstances do not result in the reversal of previously recorded markdowns or an increase in the newly established cost basis.

Restricted Assets 
Restricted Assets

Restricted cash totaled $193 million and $185 million at January 28, 2017, and January 30, 2016, respectively, and is included in other current assets in our Consolidated Balance Sheet. Such balances are pledged as collateral or restricted to use for general liability insurance and workers' compensation insurance.

Property and Equipment 
Property and Equipment

Property and equipment are recorded at cost. We compute depreciation using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are depreciated over the shorter of their estimated useful lives or the period from the date the assets are placed in service to the end of the lease term, which includes optional renewal periods if they are reasonably assured. Accelerated depreciation methods are generally used for income tax purposes.

When property is retired or otherwise disposed of, the cost and accumulated depreciation are removed from our Consolidated Balance Sheets and any resulting gain or loss is reflected in our Consolidated Statements of Earnings.

Repairs and maintenance costs are charged directly to expense as incurred. Major renewals or replacements that substantially extend the useful life of an asset are capitalized and depreciated.

Costs associated with the acquisition or development of software for internal use are capitalized and amortized over the expected useful life of the software, generally from two to seven years. A subsequent addition, modification or upgrade to internal-use software is capitalized to the extent that it enhances the software's functionality or extends its useful life. Capitalized software is included in fixtures and equipment. Software maintenance and training costs are expensed in the period incurred.

Property under capital and financing leases is comprised of buildings and equipment used in our operations. These assets are typically depreciated over the shorter of the useful life of the asset or the term of the lease. The carrying value of property under capital and financing leases was $166 million and $165 million at January 28, 2017, and January 30, 2016, respectively, net of accumulated depreciation of $134 million and $107 million, respectively.

Estimated useful lives by major asset category are as follows:
Asset
 
Life
(in years)
Buildings
 
5-35
Leasehold improvements
 
3-15
Fixtures and equipment
 
2-15
Property under capital and financing leases
 
4-5


In fiscal 2017, we removed from our fixed asset balance $345 million of fully depreciated assets that were no longer in service. This asset adjustment was based primarily on an analysis of our fixed asset records and certain other validation procedures and had no material net impact to our fiscal 2017 Consolidated Financial Statements. The impact of this adjustment on amounts previously reported was determined to be immaterial to the Consolidated Financial Statements.

Impairment of Long-Lived Assets and Costs Associated with Exit Activities 
Impairment of Long-Lived Assets and Costs Associated With Exit Activities

Long-lived assets are evaluated for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable. Factors considered important that could result in an impairment review include, but are not limited to, significant under-performance relative to historical or planned operating results, significant changes in the manner of use or expected life of the assets or significant changes in our business strategies. An impairment loss is recognized when the estimated undiscounted cash flows expected to result from the use of the asset plus net proceeds expected from the disposition of the asset, if any, are less than the carrying value of the asset net of other liabilities. When an impairment loss is recognized, the carrying amount of the asset is reduced to its estimated fair value using valuation techniques such as discounted cash flow analysis.

When reviewing long-lived assets for impairment, we group long-lived assets with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. For example, long-lived assets deployed at store locations are reviewed for impairment at the individual store level, which involves comparing the carrying value of all land, buildings, leasehold improvements, fixtures and equipment located at each store to the net cash flow projections for each store. In addition, we conduct separate impairment reviews at other levels as appropriate, for example, to evaluate potential impairment of assets shared by several areas of operations, such as information technology systems. Refer to Note 3, Fair Value Measurements, for further information associated with the long-lived assets impairments, including valuation techniques used, impairment charges incurred and remaining carrying values.

The present value of costs associated with vacated properties, primarily future lease costs net of expected sublease income, are charged to earnings when we cease using the property. We accelerate depreciation on property and equipment we expect to retire when a decision is made to abandon a property.

At January 28, 2017, and January 30, 2016, the obligation associated with vacant properties included in accrued liabilities in our Consolidated Balance Sheets was $29 million and $44 million, respectively, and the obligation associated with vacant properties included in long-term liabilities in our Consolidated Balance Sheets was $37 million and $54 million, respectively. The obligation associated with vacant properties at January 28, 2017, and January 30, 2016, included amounts associated with our restructuring activities as further described in Note 4, Restructuring Charges.
Leases 
Leases

We conduct the majority of our retail and distribution operations from leased locations. The leases generally require payment of real estate taxes, insurance and common area maintenance, in addition to rent. The terms of our new lease agreements for large-format stores are generally less than 10 years, although we have existing leases with terms up to 20 years. Small-format stores generally have lease terms that are half the length of large-format stores. Most of the leases contain renewal options and escalation clauses, and certain store leases require contingent rents based on factors such as specified percentages of revenue or the consumer price index.

For leases that contain predetermined fixed escalations of the minimum rent, we recognize the related rent expense on a straight-line basis from the date we take possession of the property to the end of the initial lease term. We record any difference between the straight-line rent amounts and amounts payable under the leases as part of deferred rent, in accrued liabilities or long-term liabilities, as appropriate.

Cash or lease incentives received upon entering into certain store leases ("tenant allowances") are recognized on a straight-line basis as a reduction to rent from the date we take possession of the property through the end of the initial lease term. We record the unamortized portion of tenant allowances as a part of deferred rent, in accrued liabilities or long-term liabilities, as appropriate.

At January 28, 2017, and January 30, 2016, deferred rent included in accrued liabilities in our Consolidated Balance Sheets was $33 million and $36 million, respectively, and deferred rent included in long-term liabilities in our Consolidated Balance Sheets was $121 million and $139 million, respectively.

In addition, we have financing leases for agreements when we are deemed the owner of the leased buildings, typically due to significant involvement during the construction period, and do not qualify for sales recognition under the sale-leaseback accounting guidance. We record the cost of the building in property and equipment, with the related short-term liability recorded in accrued liabilities and the longer-term liability recorded in long-term debt. At January 28, 2017, and January 30, 2016, we had $177 million and $178 million, respectively, outstanding under financing lease obligations. Refer to Note 8, Leases, for maturity details.
Assets acquired under capital and financing leases are depreciated over the shorter of the useful life of the asset or the lease term, including renewal periods, if reasonably assured.
Goodwill and Intangible Assets 
Goodwill and Intangible Assets
Goodwill

Goodwill is the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations. We test goodwill for impairment annually, as of the first day of the fiscal fourth quarter, or when indications of potential impairment exist. We monitor the existence of potential impairment indicators throughout the fiscal year. We test for goodwill impairment at the reporting unit level and our reporting units are the components of operating segments which constitute businesses for which discrete financial information is available and is regularly reviewed by segment management. No components were aggregated in arriving at our reporting units. Our only reporting unit with a goodwill balance at the beginning of fiscal 2017 was our Domestic segment.

Our detailed impairment testing involves comparing the fair value of each reporting unit to its carrying value, including goodwill. Fair value reflects the price a market participant would be willing to pay in a potential sale of the reporting unit and is based on discounted cash flows or relative market-based approaches. If the fair value exceeds carrying value, then it is concluded that no goodwill impairment has occurred. If the carrying value of the reporting unit exceeds its fair value, a second step is required to measure possible goodwill impairment loss. The second step includes hypothetically valuing the tangible and intangible assets and liabilities of the reporting unit as if the reporting unit had been acquired in a business combination. Then, the implied fair value of the reporting unit's goodwill is compared to the carrying value of that goodwill. If the carrying value of the reporting unit's goodwill exceeds the implied fair value of the goodwill, we recognize an impairment loss in an amount equal to the excess, not to exceed the carrying value. In fiscal 2017, we determined that the fair value of the Best Buy Domestic reporting unit exceeded its carrying value, and as a result, no goodwill impairment was recorded in fiscal 2017. No goodwill impairment was recorded in fiscal 2016.

Tradenames

We have an indefinite-lived tradename related to Pacific Sales included within our Domestic segment, which is recorded within other assets in our Consolidated Balance Sheets. As of the end of fiscal 2017, we have no indefinite-lived tradenames within our International segment.

Our valuation of identifiable intangible assets acquired is based on information and assumptions available to us at the time of acquisition, using income and market approaches to determine fair value. We do not amortize our indefinite-lived tradenames, but test for impairment annually, or when indications of potential impairment exist. We utilize the relief from royalty method to determine the fair value of each of our indefinite-lived tradenames. If the carrying value exceeds the fair value, we recognize an impairment loss in an amount equal to the excess. In fiscal 2017, we determined that the fair value of the tradename exceeded its carrying value, and as a result, no impairment was recorded in fiscal 2017. In fiscal 2016, as a part of the Canada brand restructuring, we fully impaired the indefinite-lived Future Shop tradename. Refer to Note 4, Restructuring Charges, for additional information. No other impairments were identified during fiscal 2016.

The changes in the carrying amount of goodwill and indefinite-lived tradenames by segment were as follows in fiscal 2017, 2016 and 2015 ($ in millions):
 
Goodwill
 
Indefinite-Lived Tradenames
 
Domestic
 
Domestic
 
International
 
Total
Balances at February 1, 2014
$
425

 
$
19

 
$
82

 
$
101

Sale of business(1)
—

 
—

 
(37
)
 
(37
)
Impairments
—

 
(1
)
 
—

 
(1
)
Changes in foreign currency exchange rates
—

 
—

 
(6
)
 
(6
)
Balances at January 31, 2015
425

 
18

 
39

 
57

Canada brand restructuring(2)
—

 
—

 
(40
)
 
(40
)
Changes in foreign currency exchange rates
—

 
—

 
1

 
1

Balances at January 30, 2016
425

 
18

 
—

 
18

Balances at January 28, 2017
$
425

 
$
18

 
$
—

 
$
18


(1)
Primarily represents the Five Star indefinite-lived tradenames classified as held for sale at January 31, 2015.
(2)
Represents the Future Shop tradename impaired as a result of the Canada brand restructuring in the first quarter of fiscal 2016. See Note 4, Restructuring Charges, for further discussion.
The following table provides the gross carrying amount of goodwill and cumulative goodwill impairment losses ($ in millions):
 
January 28, 2017
 
January 30, 2016
 
Gross Carrying
Amount
 
Cumulative
Impairment
 
Gross Carrying
Amount
 
Cumulative
Impairment
Goodwill
$
1,100

 
$
(675
)
 
$
1,100

 
$
(675
)
Insurance 
Insurance
 
We are self-insured for certain losses related to health, workers' compensation and general liability claims; however, we obtain third-party insurance coverage to limit our exposure to certain claims. Some of these self-insured losses are managed through a wholly-owned insurance captive. We estimate our self-insured liabilities using a number of factors, including historical claims experience, an estimate of incurred but not reported claims, demographic and severity factors and valuations provided by independent third-party actuaries. Our self-insured liabilities included in the Consolidated Balance Sheets were as follows ($ in millions):
 
January 28, 2017
 
January 30, 2016
Accrued liabilities
$
65

 
$
62

Long-term liabilities
63

 
54

Total
$
128

 
$
116

Income Taxes 


Income Taxes

We account for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards. We record a valuation allowance to reduce the carrying amounts of deferred tax assets if it is more likely than not that such assets will not be realized.

In determining our provision for income taxes, we use an annual effective income tax rate based on annual income, permanent differences between book and tax income and statutory income tax rates. The effective income tax rate also reflects our assessment of the ultimate outcome of tax audits. We adjust our annual effective income tax rate as additional information on outcomes or events becomes available. Discrete events, such as audit settlements or changes in tax laws, are recognized in the period in which they occur.

Our income tax returns are periodically audited by U.S. federal, state and local and foreign tax authorities. At any one time, multiple tax years are subject to audit by the various tax authorities. In evaluating the tax benefits associated with our various tax filing positions, we record a tax benefit for uncertain tax positions using the highest cumulative tax benefit that is more likely than not to be realized. A number of years may elapse before a particular matter, for which we have established a liability, is audited and effectively settled. We adjust our liability for unrecognized tax benefits in the period in which we determine the issue is effectively settled with the tax authorities, the statute of limitations expires for the relevant taxing authority to examine the tax position or when more information becomes available. We include our liability for unrecognized tax benefits, including accrued penalties and interest, in accrued income taxes and long-term liabilities on our Consolidated Balance Sheets and in income tax expense in our Consolidated Statements of Earnings.

Accrued Liabilities 

Accrued Liabilities

The major components of accrued liabilities at January 28, 2017, and January 30, 2016, were state and local tax liabilities, advertising accruals, rent-related liabilities, including accrued real estate taxes, loyalty program liabilities and self-insurance reserves.

Long-Term Liabilities 

Long-Term Liabilities

The major components of long-term liabilities at January 28, 2017, and January 30, 2016, were unrecognized tax benefits, rent-related liabilities, self-insurance reserves, deferred revenue and deferred compensation plan liabilities.

Foreign Currency 

Foreign Currency

Foreign currency denominated assets and liabilities are translated into U.S. dollars using the exchange rates in effect at our Consolidated Balance Sheet date. For operations reported on a one-month lag, we use the exchange rates in effect one month prior to our Consolidated Balance Sheet date. Results of operations and cash flows are translated using the average exchange rates throughout the period. The effect of exchange rate fluctuations on the translation of assets and liabilities is included as a component of shareholders' equity in accumulated other comprehensive income. Gains and losses from foreign currency transactions, which are included in SG&A, have not been significant in any of the periods presented.

Revenue Recognition 

Revenue Recognition

We recognize revenue when the sales price is fixed or determinable, collection is reasonably assured and the customer takes possession of the merchandise, or in the case of services, the service has been provided. Revenue excludes sales taxes collected. Revenue from merchandise sales and services is reported net of sales returns, which includes an estimate of future returns based on historical return rates, with a corresponding reduction to cost of sales. Our sales returns reserve, which represents the estimated gross margin impact of returns, was $28 million and $25 million at January 28, 2017, and January 30, 2016, respectively.

For revenue transactions that involve multiple deliverables, we defer the revenue associated with any undelivered elements. The amount of revenue deferred in connection with the undelivered elements is determined using the relative fair value of each element, which is generally based on each element's relative retail price.
Our deferred revenues primarily relate to merchandise not yet delivered to customers, services not yet completed and technical support contracts not yet completed. Short-term deferred revenue was $418 million and $357 million as of January 28, 2017, and January 30, 2016, respectively. At January 28, 2017, and January 30, 2016, deferred revenue included within long-term liabilities in our Consolidated Balance Sheets was $34 million and $45 million, respectively.

Merchandise revenue
Revenue is recognized for store sales when the customer receives and pays for merchandise. In the case of items paid for in store but subsequently delivered to the customer, revenue is recognized once delivery has been completed.
For transactions initiated online, customers choose whether to collect merchandise from one of our stores (“in-store pick up”) or have it delivered to them (typically using third party parcel delivery companies). For in-store pick up, we recognize revenue once the customer has taken possession of merchandise. For items delivered directly to the customer, we recognize revenue when delivery has been completed. Any fees charged to customers for delivery are also recognized when delivery has been completed.
Services
Revenue related to consultation, design, installation, set-up, repair and educational classes are recognized once the service is complete. We sell various protection plans with extended warranty coverage for merchandise and technical support to assist customers in using their devices. Such plans have terms typically ranging from one month to five years. For extended warranty protection, third party underwriters assume the risk associated with the coverage and are deemed to be the legal obligor. We record the net commissions we receive (the amount charged to the customer less the premiums remitted to the underwriter) as revenue when the corresponding merchandise revenue is recognized. In addition, we are eligible to receive profit sharing payments, which are dependent upon the performance of the portfolio. We record such profit share as revenue once the portfolio period to which it relates is complete, and we have sufficient evidence to estimate the amount. Service and commission revenues earned from the sale of extended warranties represented 2.2%, 2.3% and 2.1% of revenue in fiscal 2017, 2016 and 2015, respectively. These percentages include $133 million, $158 million and $19 million, in fiscal 2017, 2016 and 2015, respectively, of profit share revenue.
For technical support contracts, we assume responsibility for fulfilling the support to customers and we recognize the associated revenue either on a straight-line basis over the life of the contracts, or, if sufficient history is available, on a consumption basis.
Credit card revenue
We offer promotional financing and credit cards issued by third-party banks that manage and directly extend credit to our customers. The banks are the sole owners of the accounts receivable generated under the program and accordingly, we do not hold any consumer receivables related to these programs. We are eligible to receive a profit share from our banking partners based on the performance of the programs. We record such profit share as revenue once the portfolio period to which it relates is complete, and we have sufficient evidence to estimate the amount.
Gift cards
We sell gift cards to our customers in our retail stores, online and through select third parties. We do not charge administrative fees on unused gift cards and our gift cards do not have an expiration date. We recognize revenue from gift cards when: (i) the gift card is redeemed by the customer; or (ii) the likelihood of the gift card being redeemed by the customer is remote, and we determine that we do not have a legal obligation to remit the value of unredeemed gift cards to the relevant jurisdictions ("gift card breakage"). We determine our gift card breakage rate based upon historical redemption patterns and recognize the projected breakage 24 months after the gift card is issued. Gift card breakage income is included in revenue in our Consolidated Statements of Earnings. Gift card breakage income was $37 million, $46 million and $19 million in fiscal 2017, 2016 and 2015, respectively.

Sales Incentives
We frequently offer sales incentives that entitle our customers to receive a gift card at time of purchase or a reduction in the price of a product or service either at the point of sale or by submitting a claim for a refund (for example coupons, rebates, etc.). For sales incentives issued to the customer in conjunction with a sale of merchandise or services, the reduction in revenue is recognized at the time of sale, based on the expected retail value of the incentive expected to be redeemed.
Customer Loyalty Programs
We have customer loyalty programs which allow members to earn points for each qualifying purchase. Points earned enable members to receive a certificate that may be redeemed on future purchases at our Best Buy branded stores. Depending on the customer's membership level within our loyalty program, certificates expirations typically range from 2 to 12 months from the date of issuance. The retail value of points earned by our loyalty program members is included in accrued liabilities and recorded as a reduction of revenue at the time the points are earned, based on the percentage of points that are projected to be redeemed.
We recognize revenue when: (i) a certificate is redeemed by the customer; (ii) a certificate expires; or (iii) the likelihood of a certificate being redeemed by a customer is low ("certificate breakage"). We determine our certificate breakage rate based upon historical redemption patterns.
Cost of Goods Sold 
Cost of Goods Sold and Selling, General and Administrative Expenses
The following table illustrates the primary costs classified in each major expense category:
Cost of Goods Sold
•
 
Total cost of products sold including:
 
 
—
 
Freight expenses associated with moving merchandise inventories from our vendors to our distribution centers;
 
 
—
 
Vendor allowances that are not a reimbursement of specific, incremental and identifiable costs; and
 
 
—
 
Cash discounts on payments to merchandise vendors;
•
 
Cost of services provided including:
 
 
—
 
Payroll and benefits costs for services employees; and
 
 
—
 
Cost of replacement parts and related freight expenses;
•
 
Physical inventory losses;
•
 
Markdowns;
•
 
Customer shipping and handling expenses;
•
 
Costs associated with operating our distribution network, including payroll and benefit costs, occupancy costs and depreciation; and
•
 
Freight expenses associated with moving merchandise inventories from our distribution centers to our retail stores.
SG&A
•
 
Payroll and benefit costs for retail and corporate employees;
•
 
Occupancy and maintenance costs of retail, services and corporate facilities;
•
 
Depreciation and amortization related to retail, services and corporate assets;
•
 
Advertising costs;
•
 
Vendor allowances that are a reimbursement of specific, incremental and identifiable costs to promote a vendor's products;
•
 
Tender costs, including bank charges and costs associated with credit and debit card interchange fees;
•
 
Charitable contributions;
•
 
Outside and outsourced service fees;
•
 
Long-lived asset impairment charges; and
•
 
Other administrative costs, such as supplies, travel and lodging.


Selling, General and Administrative Expenses 
Cost of Goods Sold and Selling, General and Administrative Expenses
The following table illustrates the primary costs classified in each major expense category:
Cost of Goods Sold
•
 
Total cost of products sold including:
 
 
—
 
Freight expenses associated with moving merchandise inventories from our vendors to our distribution centers;
 
 
—
 
Vendor allowances that are not a reimbursement of specific, incremental and identifiable costs; and
 
 
—
 
Cash discounts on payments to merchandise vendors;
•
 
Cost of services provided including:
 
 
—
 
Payroll and benefits costs for services employees; and
 
 
—
 
Cost of replacement parts and related freight expenses;
•
 
Physical inventory losses;
•
 
Markdowns;
•
 
Customer shipping and handling expenses;
•
 
Costs associated with operating our distribution network, including payroll and benefit costs, occupancy costs and depreciation; and
•
 
Freight expenses associated with moving merchandise inventories from our distribution centers to our retail stores.
SG&A
•
 
Payroll and benefit costs for retail and corporate employees;
•
 
Occupancy and maintenance costs of retail, services and corporate facilities;
•
 
Depreciation and amortization related to retail, services and corporate assets;
•
 
Advertising costs;
•
 
Vendor allowances that are a reimbursement of specific, incremental and identifiable costs to promote a vendor's products;
•
 
Tender costs, including bank charges and costs associated with credit and debit card interchange fees;
•
 
Charitable contributions;
•
 
Outside and outsourced service fees;
•
 
Long-lived asset impairment charges; and
•
 
Other administrative costs, such as supplies, travel and lodging.
Vendor Allowances 
Vendor Allowances
 
We receive allowances from certain vendors through a variety of programs and arrangements intended to offset our costs of promoting and selling merchandise inventories. Vendor allowances are primarily in the form of receipt-based funds or sell-through credits. Receipt-based funds are generally determined at an agreed percentage of purchase price and are initially deferred and recorded as a reduction of merchandise inventories. The deferred amounts are then included as a reduction of cost of goods sold when the related product is sold. Sell-through credits are generally calculated using an agreed upon amount for each unit sold and are recognized when the related product is sold. Vendor allowances provided as a reimbursement of specific, incremental and identifiable costs, such as specialized store labor or training costs, are included in SG&A as an expense reduction when the cost is incurred.
Advertising Costs 
Advertising Costs
 
Advertising costs, which are included in SG&A, are expensed when the advertisement runs. Advertising costs consist primarily of digital, print and television advertisements, as well as promotional events. Advertising expenses were $743 million, $742 million and $711 million in fiscal 2017, 2016 and 2015, respectively.
Stock-Based Compensation 
Stock-Based Compensation
 
We apply the fair value recognition provisions of accounting guidance as they relate to our stock-based compensation, which requires us to recognize expense for the fair value of our stock-based compensation awards. Compensation expense is recognized over the period in which services are required. It is recognized on a straight-line basis, except where there are performance awards that vest on a graded basis in which case the expense for these awards is front-loaded, or recognized on a graded attribution basis.
Summary of Significant Accounting Policies (Tables)
Schedule of estimated useful lives by major asset category 
Estimated useful lives by major asset category are as follows:
Asset
 
Life
(in years)
Buildings
 
5-35
Leasehold improvements
 
3-15
Fixtures and equipment
 
2-15
Property under capital and financing leases
 
4-5
Schedule of changes in carrying amount of goodwill and indefinite lived tradenames by segment 

The changes in the carrying amount of goodwill and indefinite-lived tradenames by segment were as follows in fiscal 2017, 2016 and 2015 ($ in millions):
 
Goodwill
 
Indefinite-Lived Tradenames
 
Domestic
 
Domestic
 
International
 
Total
Balances at February 1, 2014
$
425

 
$
19

 
$
82

 
$
101

Sale of business(1)
—

 
—

 
(37
)
 
(37
)
Impairments
—

 
(1
)
 
—

 
(1
)
Changes in foreign currency exchange rates
—

 
—

 
(6
)
 
(6
)
Balances at January 31, 2015
425

 
18

 
39

 
57

Canada brand restructuring(2)
—

 
—

 
(40
)
 
(40
)
Changes in foreign currency exchange rates
—

 
—

 
1

 
1

Balances at January 30, 2016
425

 
18

 
—

 
18

Balances at January 28, 2017
$
425

 
$
18

 
$
—

 
$
18


(1)
Primarily represents the Five Star indefinite-lived tradenames classified as held for sale at January 31, 2015.
(2)
Represents the Future Shop tradename impaired as a result of the Canada brand restructuring in the first quarter of fiscal 2016. See Note 4, Restructuring Charges, for further discussion.
Schedule of goodwill 
 
January 28, 2017
 
January 30, 2016
 
Gross Carrying
Amount
 
Cumulative
Impairment
 
Gross Carrying
Amount
 
Cumulative
Impairment
Goodwill
$
1,100

 
$
(675
)
 
$
1,100

 
$
(675
)
Schedule of self insurance liability 
Our self-insured liabilities included in the Consolidated Balance Sheets were as follows ($ in millions):
 
January 28, 2017
 
January 30, 2016
Accrued liabilities
$
65

 
$
62

Long-term liabilities
63

 
54

Total
$
128

 
$
116



Schedule of primary costs, classified in each major expense category 
The following table illustrates the primary costs classified in each major expense category:
Cost of Goods Sold
•
 
Total cost of products sold including:
 
 
—
 
Freight expenses associated with moving merchandise inventories from our vendors to our distribution centers;
 
 
—
 
Vendor allowances that are not a reimbursement of specific, incremental and identifiable costs; and
 
 
—
 
Cash discounts on payments to merchandise vendors;
•
 
Cost of services provided including:
 
 
—
 
Payroll and benefits costs for services employees; and
 
 
—
 
Cost of replacement parts and related freight expenses;
•
 
Physical inventory losses;
•
 
Markdowns;
•
 
Customer shipping and handling expenses;
•
 
Costs associated with operating our distribution network, including payroll and benefit costs, occupancy costs and depreciation; and
•
 
Freight expenses associated with moving merchandise inventories from our distribution centers to our retail stores.
SG&A
•
 
Payroll and benefit costs for retail and corporate employees;
•
 
Occupancy and maintenance costs of retail, services and corporate facilities;
•
 
Depreciation and amortization related to retail, services and corporate assets;
•
 
Advertising costs;
•
 
Vendor allowances that are a reimbursement of specific, incremental and identifiable costs to promote a vendor's products;
•
 
Tender costs, including bank charges and costs associated with credit and debit card interchange fees;
•
 
Charitable contributions;
•
 
Outside and outsourced service fees;
•
 
Long-lived asset impairment charges; and
•
 
Other administrative costs, such as supplies, travel and lodging.
Discontinued Operations (Tables)
Disposal Groups, Including Discontinued Operations [Table Text Block]
The aggregate financial results of all discontinued operations for fiscal 2017, 2016 and 2015 were as follows ($ in millions):
 
2017
 
2016
 
2015
Revenue
$
—

 
$
217

 
$
1,564

Restructuring charges(1)
—

 
1

 
18

Gain (loss) from discontinued operations before income tax expense
28

 
(8
)
 
(12
)
Income tax expense
(7
)
 
(1
)
 
—

Gain on sale of discontinued operations
—

 
99

 
1

Net earnings (loss) from discontinued operations including noncontrolling interests
21

 
90

 
(11
)
Net earnings from discontinued operations attributable to noncontrolling interests
—

 
—

 
(2
)
Net earnings (loss) from discontinued operations attributable to Best Buy Co., Inc. shareholders
$
21

 
$
90

 
$
(13
)
(1)
See Note 4, Restructuring Charges, for further discussion of the restructuring charges associated with discontinued operations.
Fair Value Measurements (Tables)
Fair value, assets and liabilities measured on recurring basis 
The following table sets forth by level within the fair value hierarchy, our financial assets and liabilities that were accounted for at fair value on a recurring basis at January 28, 2017, and January 30, 2016, according to the valuation techniques we used to determine their fair values ($ in millions):
 
 
 
Fair Value at
 
Fair Value Hierarchy
 
January 28, 2017
 
January 30, 2016
Assets
 
 
 
 
 
Cash and cash equivalents
 
 
 
 
 
Money market funds
Level 1
 
$
290

 
$
51

Commercial paper
Level 2
 
—

 
265

Time deposits
Level 2
 
15

 
306

Short-term investments
 
 
 
 
 
Corporate bonds
Level 2
 
—

 
193

Commercial paper
Level 2
 
349

 
122

Time deposits
Level 2
 
1,332

 
990

Other current assets
 
 
 
 
 
Money market funds
Level 1
 
7

 
—

Commercial paper
Level 2
 
60

 
—

Foreign currency derivative instruments
Level 2
 
2

 
18

Time deposits
Level 2
 
100

 
79

Other assets
 
 
 
 
 
Interest rate swap derivative instruments
Level 2
 
13

 
25

Auction rate securities
Level 3
 
—

 
2

Marketable securities that fund deferred compensation
Level 1
 
96

 
96

Liabilities
 
 
 
 
 
Accrued Liabilities
 
 
 
 
 
Foreign currency derivative instruments
Level 2
 
3

 
1

 
Fair value, assets and liabilities measured on nonrecurring basis, fair value remeasurements (impairments) 
The following table summarizes the fair value remeasurements for non-restructuring property and equipment impairments and restructuring activities related to continuing operations recorded in fiscal 2017 and 2016 ($ in millions):
 
2017
 
2016
 
Impairments
 
Remaining Net
Carrying Value(1)
 
Impairments
 
Remaining Net
Carrying Value (1)
Property and equipment (non-restructuring)
$
28

 
$
—

 
$
61

 
$
15

Restructuring activities(2)
 
 
 
 
 
 
 
Property and equipment
8

 
—

 
30

 
—

Tradename
—

 
—

 
40

 
—

Total
$
36

 
$
—

 
$
131

 
$
15

(1)
Remaining net carrying value approximates fair value. Because assets subject to long-lived asset impairment are not measured at fair value on a recurring basis, certain fair value measurements presented in the table may reflect values at earlier measurement dates and may no longer represent the fair values at January 28, 2017, and January 30, 2016.
(2)
See Note 4, Restructuring Charges, for additional information.
Restructuring Charges (Tables)
Composition of restructuring charges 
Restructuring charges incurred in fiscal 2017, 2016 and 2015 were as follows ($ in millions):
 
2017
 
2016
 
2015
Continuing operations
 
 
 
 
 
Renew Blue Phase 2
$
26

 
$
—

 
$
—

Canadian brand consolidation
3

 
200

 
—

Renew Blue(1)
5

 
(2
)
 
11

Other restructuring activities(2)
5

 
3

 
(6
)
Total continuing operations
39

 
201

 
5

Discontinued operations
 
 
 
 
 
Renew Blue(1)
—

 
—

 
18

Total
$
39

 
$
201

 
$
23


(1) Represents activity related to our remaining termination benefits and vacant space liabilities, primarily in our International segment, for our Renew Blue restructuring program, which began in the fourth quarter of fiscal 2013. Continuing operations charges related to the Domestic segment were $0 million, benefit of $1 million and $10 million for fiscal 2017, 2016 and 2015, respectively; and to the International segment were $5 million, benefit of $1 million and $1 million for fiscal 2017, 2016 and 2015, respectively. All discontinued operations charges related to the International segment. As of January 28, 2017, the termination benefits liability was $0 million and the remaining vacant space liability was $9 million. We may continue to incur immaterial adjustments to the vacant space liability for charges in sublease assumptions or potential lease buyouts. In addition, lease payments for vacated stores will continue until leases expire or are terminated.

(2) Represents activity related to our remaining vacant space liability for U.S. large-format store closures in fiscal 2013. We may continue to incur immaterial adjustments to the liability for changes in sublease assumptions or potential lease buyouts. In addition, lease payments for vacated stores will continue until leases expire or are terminated. The remaining vacant space liability was $14 million at January 28, 2017.
Restructuring accrual activity 
The following table summarizes our restructuring accrual activity during fiscal 2017 related to termination benefits as a result of Renew Blue Phase 2 ($ in millions):
 
Termination
Benefits
Balances at January 30, 2016
$
—

Charges
19

Cash payments
(17
)
Adjustments
(2
)
Balances at January 28, 2017
$
—

Composition of restructuring charges 
The composition of the restructuring charges we incurred during fiscal 2017 for Renew Blue Phase 2 was as follows ($ in millions):
 
Domestic
 
2017
Property and equipment impairments
$
8

Termination benefits
18

      Total Renew Blue Phase 2 restructuring charges
$
26

Restructuring accrual activity 
The following tables summarize our restructuring accrual activity during the fiscal 2017 and 2016, related to termination benefits and facility closure and other costs associated with Canadian brand consolidation ($ in millions):
 
Termination
Benefits
 
Facility
Closure and
Other Costs
 
Total
Balances at January 31, 2015
$
—

 
$
—

 
$
—

Charges
28

 
113

 
141

Cash payments
(24
)
 
(47
)
 
(71
)
Adjustments(1)
(2
)
 
5

 
3

Changes in foreign currency exchange rates
—

 
(7
)
 
(7
)
Balances at January 30, 2016
$
2

 
$
64

 
$
66

Charges
—

 
1

 
1

Cash payments
(2
)
 
(37
)
 
(39
)
Adjustments(1)
—

 
2

 
2

Changes in foreign currency exchange rates
—

 
4

 
4

Balances at January 28, 2017
$
—

 
$
34

 
$
34

(1) The adjustments related to termination benefits relate to higher-than-expected employee retention. Adjustments to facility closure and other costs represent changes in sublease assumptions.
Composition of restructuring charges 
The composition of the restructuring charges we incurred for this program in fiscal 2017 and 2016, as well as the cumulative amount incurred through the end of fiscal 2017, was as follows ($ in millions):
 
International
 
2017
 
2016
 
Cumulative Amount
Continuing operations
 
 
 
 
 
Inventory write-downs
$
—

 
$
3

 
$
3

Property and equipment impairments
—

 
30

 
30

Tradename impairment
—

 
40

 
40

Termination benefits
—

 
25

 
25

Facility closure and other costs
3

 
102

 
105

Total continuing operations
$
3

 
$
200

 
$
203

Debt (Tables)
Schedule of long-term debt 
Long-term debt consisted of the following ($ in millions):
 
January 28, 2017
 
January 30, 2016
2016 Notes
$
—

 
$
350

2018 Notes
500

 
500

2021 Notes
650

 
650

Interest rate swap valuation adjustments
13

 
25

Subtotal
1,163

 
1,525

Debt discounts and issuance costs
(5
)
 
(7
)
Financing lease obligations
177

 
178

Capital lease obligations
30

 
38

Total long-term debt
1,365

 
1,734

Less: current portion
(44
)
 
(395
)
Total long-term debt, less current portion
$
1,321

 
$
1,339



Schedule of future maturities of long-term debt, including capitalized leases 
At January 28, 2017, the future maturities of long-term debt, excluding debt discounts and issuance costs and financing and capital lease obligations (see Note 8, Leases, for the future lease obligation maturities), consisted of the following ($ in millions):
Fiscal Year
 
2018
$
—

2019
511

2020
—

2021
—

2022
652

Thereafter
—

Total long-term debt
$
1,163

Derivative Instruments (Tables)
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block] 
The following table presents the gross fair values for outstanding derivative instruments and the corresponding classification at January 28, 2017, and January 30, 2016:
 
January 28, 2017
 
January 30, 2016
Contract Type
Assets
Liabilities
 
Assets
Liabilities
Derivatives designated as net investment hedges(1)
$
2

$
2

 
$
15

$
1

Derivatives designated as interest rate swaps(2)
13

—

 
25

—

No hedge designation (foreign exchange forward contracts)(1)
—

1

 
3

—

Total
$
15

$
3

 
$
43

$
1

(1)
The fair value is recorded in other current assets or accrued liabilities.
(2)
The fair value is recorded in other assets or long-term liabilities
Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss) [Table Text Block] 
The following table presents the effects of derivative instruments on other comprehensive income ("OCI") and on our Consolidated Statements of Earnings for fiscal 2017 and 2016:
 
2017
 
2016
Contract Type
Pre-tax Gain (Loss) Recognized in OCI
 
Gain(Loss) Reclassified from Accumulated OCI to Earnings
(Effective Portion)
 
Pre-tax Gain (Loss) Recognized in OCI
 
Gain(Loss) Reclassified from Accumulated OCI to Earnings
(Effective Portion)
Derivatives designated as net investment hedges
$
(14
)
 
$
—

 
$
21

 
$
—

Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location [Table Text Block] 
The following table presents the effects of derivatives on our Consolidated Statements of Earnings for fiscal 2017 and 2016:
 
Gain (Loss) Recognized within SG&A
Contract Type
2017
 
2016
No hedge designation (foreign exchange forward contracts)
$
(3
)
 
$
4

Schedule of Interest Rate Derivatives [Table Text Block] 
The following table presents the effects of interest rate derivatives on our Consolidated Statements of Earnings for fiscal 2017 and 2016:
 
Gain (Loss) Recognized within Interest Expense
Contract Type
2017
 
2016
Interest rate swap gain (loss)
$
(12
)
 
$
23

Adjustments to carrying value of long-term debt
12

 
(23
)
Net impact on consolidated statement of earnings
$
—

 
$
—

Schedule of Notional Amounts of Outstanding Derivative Positions [Table Text Block] 
The following table presents the notional amounts of our derivative instruments at January 28, 2017, and January 30, 2016:
 
Notional Amount
Contract Type
January 28, 2017
 
January 30, 2016
Derivatives designated as net investment hedges
$
205

 
$
208

Derivatives designated as interest rate swaps
750

 
750

No hedge designation (foreign exchange forward contracts)
43

 
94

Total
$
998

 
$
1,052

Shareholders' Equity (Tables)
Schedule of Nonvested Performance-based Units Activity [Table Text Block] 
A summary of the status of our nonvested performance-based share awards at January 28, 2017, and changes during fiscal 2017, is as follows:
Performance-Based Share Awards
 
Shares
 
Weighted-Average Fair Value per Share
Outstanding at January 30, 2016
 
—

 
$
—

Granted
 
513,000

 
$
29.08

Forfeited/Canceled
 
(75,000
)
 
$
29.66

Outstanding at January 28, 2017
 
438,000

 
$
28.98

Stock-based compensation expense 
Stock-based compensation expense was as follows in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Stock options
$
9

 
$
15

 
$
17

Share awards
 
 
 
 
 
Market-based
15

 
16

 
10

Performance-based
6

 
—

 
—

Time-based
78

 
73

 
60

Total
$
108

 
$
104

 
$
87

Stock option activity 
Stock option activity was as follows in fiscal 2017:
 
Stock
Options
 
Weighted-Average Exercise Price per Share
 
Weighted-Average Remaining Contractual Term
(in years)
 
Aggregate
Intrinsic Value
(in millions)
Outstanding at January 30, 2016
14,242,000

 
$
36.51

 
 
 
 

Granted
224,000

 
$
31.79

 
 
 
 

Exercised
(5,273,000
)
 
$
31.29

 
 
 
 

Forfeited/Canceled
(2,206,000
)
 
$
48.13

 
 
 
 

Outstanding at January 28, 2017
6,987,000

 
$
36.61

 
4.3
 
$
54

Vested or expected to vest at January 28, 2017
6,987,000

 
$
36.61

 
4.3
 
$
54

Exercisable at January 28, 2017
5,858,000

 
$
36.63

 
3.5
 
$
46

Assumption used to estimate the fair value of stock option on the date of grant using a lattice or Black Scholes model 
In fiscal 2017, 2016 and 2015, we estimated the fair value of each stock option on the date of grant using a lattice or Black Scholes valuation model (for certain individuals) with the following assumptions:
Valuation Assumptions(1)
 
2017
 
2016
 
2015
Risk-free interest rate(2)
 
0.5% – 2.0%

 
0.1% – 2.1%

 
0.1% – 2.4%

Expected dividend yield
 
3.5
%
 
2.3
%
 
2.5
%
Expected stock price volatility(3)
 
37
%
 
37
%
 
40
%
Expected life of stock options (in years)(4)
 
6.0

 
6.0

 
6.0


(1)
Forfeitures are estimated using historical experience and projected employee turnover.
(2)
Based on the U.S. Treasury constant maturity interest rate whose term is consistent with the expected life of our stock options.
(3)
In projecting expected stock price volatility, we consider both the historical volatility of our stock price as well as implied volatilities from exchange-traded options on our stock.
(4)
We estimate the expected life of stock options based upon historical experience.

Summary of the status of nonvested market-based share awards 
A summary of the status of our nonvested market-based share awards at January 28, 2017, and changes during fiscal 2017, is as follows:
Market-Based Share Awards
 
Shares
 
Weighted-Average Fair Value per Share
Outstanding at January 30, 2016
 
1,462,000

 
$
32.33

Granted
 
1,088,000

 
$
29.52

Vested
 
(781,000
)
 
$
26.84

Forfeited/Canceled
 
(217,000
)
 
$
33.27

Outstanding at January 28, 2017
 
1,552,000

 
$
32.99

Summary of the status of nonvested time-based share awards 
A summary of the status of our nonvested time-based share awards at January 28, 2017, and changes during fiscal 2017, is as follows:
Time-Based Share Awards
 
Shares
 
Weighted-Average Fair Value per Share
Outstanding at January 30, 2016
 
5,103,000

 
$
31.89

Granted
 
2,979,000

 
$
30.68

Vested
 
(2,202,000
)
 
$
30.83

Forfeited/Canceled
 
(515,000
)
 
$
32.76

Outstanding at January 28, 2017
 
5,365,000

 
$
31.57

Summary of stock options outstanding 
At January 28, 2017, options to purchase 7.0 million shares of common stock were outstanding as follows (shares in millions):
 
Exercisable
 
Unexercisable
 
Total
 
Shares
 
%
 
Weighted-
Average Price
per Share
 
Shares
 
%
 
Weighted-
Average Price
per Share
 
Shares
 
%
 
Weighted-
Average Price
per Share
In-the-money
2.3

 
39
%
 
$
26.38

 
0.5

 
45
%
 
$
30.84

 
2.8

 
40
%
 
$
27.13

Out-of-the-money
3.6

 
61
%
 
$
43.45

 
0.6

 
55
%
 
$
40.66

 
4.2

 
60
%
 
$
43.01

Total
5.9

 
100
%
 
$
36.64

 
1.1

 
100
%
 
$
36.54

 
7.0

 
100
%
 
$
36.61

Reconciliation of the numerators and denominators of basic and diluted earnings per share 
The following table presents a reconciliation of the numerators and denominators of basic and diluted earnings per share from continuing operations attributable to Best Buy Co., Inc. in fiscal 2017, 2016 and 2015 ($ and shares in millions, except per share amounts):
 
2017
 
2016
 
2015
Numerator (in millions):
 
 
 
 
 
Net earnings from continuing operations attributable to Best Buy Co., Inc., shareholders
$
1,207

 
$
807

 
$
1,246

Denominator (in millions):
 
 
 
 
 
Weighted-average common shares outstanding
318.5

 
346.5

 
349.5

Effect of potentially dilutive securities:
 
 
 
 
 
Stock options and other
4.1

 
4.2

 
4.1

Weighted-average common shares outstanding, assuming dilution
322.6

 
350.7

 
353.6

Net earnings per share from continuing operations attributable to Best Buy Co., Inc. shareholders
 
 
 
 
 
Basic
$
3.79

 
$
2.33

 
$
3.57

Diluted
$
3.74

 
$
2.30

 
$
3.53

Repurchases of common stock 
The following table presents information regarding the shares we repurchased and retired in fiscal 2017 and 2016, noting that we had no repurchases and retirements in fiscal 2015 ($ and shares in millions, except per share amounts):
 
2017
 
2016
Total cost of shares repurchased
 
 
 
Open market(1)
$
706

 
$
880

January 2016 ASR
45

 
120

     Total
$
751

 
$
1,000

 
 
 
 
Average price per share
 
 
 
Open market
$
36.11

 
$
31.03

January 2016 ASR
$
28.55

 
$
27.28

     Average
$
35.54

 
$
30.53

 
 
 
 
Number of shares repurchased and retired
 
 
 
Open market(1)
19.5

 
28.4
January 2016 ASR
1.6

 
4.4
     Total
21.1

 
32.8

(1)
As of January 28, 2017, $8 million, or 0.1 million shares, in trades remained unsettled. The liability for unsettled trades is included in accrued liabilities in the Consolidated Balance Sheets.
Components of accumulated other comprehensive income, net of tax 
The following table provides a reconciliation of the components of accumulated other comprehensive income, net of tax, attributable to Best Buy Co., Inc. shareholders for fiscal 2017, 2016, and 2015, respectively ($ in millions):
 
Foreign Currency Translation
 
Available-For-Sale Investments(1)
 
Total
Balances at February 1, 2014
$
485

 
$
7

 
$
492

Foreign currency translation adjustments
(103
)
 
—

 
(103
)
Unrealized gains on available-for-sale investments
—

 
(3
)
 
(3
)
Reclassification of losses on available-for-sale investments into earnings
—

 
(4
)
 
(4
)
Balances at January 31, 2015
382

 
—

 
382

Foreign currency translation adjustments
(44
)
 
—

 
(44
)
Reclassification of foreign currency translation adjustments into earnings due to sale of business
(67
)
 
—

 
(67
)
Balances at January 30, 2016
271

 
—

 
271

Foreign currency translation adjustments
10

 
—

 
10

Reclassification of foreign currency translation adjustments into earnings
(2
)
 
—

 
(2
)
Balances at January 28, 2017
$
279

 
$
—

 
$
279


(1)
There were no material tax impacts to gains or losses on available-for-sale investments in the periods presented.
Leases (Tables)
Schedule of composition of net rent expense for operating leases, including leases of property and equipment 
The composition of net rent expense for all operating leases, including leases of property and equipment, was as follows in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Minimum rentals
$
789

 
$
797

 
$
848

Contingent rentals
1

 
1

 
2

Total rent expense
790

 
798

 
850

Less: sublease income
(16
)
 
(15
)
 
(18
)
Net rent expense
$
774

 
$
783

 
$
832

Schedule of future minimum lease payments under capital, financing and operating leases (not including contingent rentals) 
The future minimum lease payments under our capital, financing and operating leases by fiscal year (not including contingent rentals) at January 28, 2017, were as follows ($ in millions):
Fiscal Year
 
Capital
Leases
 
Financing
Leases
 
Operating
Leases(1)
2018
 
$
9

 
$
46

 
$
803

2019
 
7

 
41

 
676

2020
 
4

 
35

 
546

2021
 
3

 
28

 
411

2022
 
2

 
20

 
285

Thereafter
 
11

 
56

 
404

Total minimum lease payments
 
36

 
226

 
$
3,125

Less amount representing interest
 
(6
)
 
(49
)
 
 
Present value of minimum lease payments
 
30

 
177

 
 
Less current maturities
 
(8
)
 
(36
)
 
 

Present value of minimum lease payments, less current maturities
 
$
22

 
$
141

 
 


(1)
Operating lease obligations do not include payments to landlords covering real estate taxes and common area maintenance. These charges, if included, would increase total operating lease obligations by $1.0 billion at January 28, 2017.
Income Taxes (Tables)
Reconciliation of the federal statutory income tax rate to income tax expense 
The following is a reconciliation of the federal statutory income tax rate to income tax expense in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Federal income tax at the statutory rate
$
635

 
$
458

 
$
485

State income taxes, net of federal benefit
38

 
38

 
43

(Benefit) expense from foreign operations
(46
)
 
5

 
(23
)
Other
(18
)
 
2

 
(11
)
Legal entity reorganization
—

 
—

 
(353
)
Income tax expense
$
609

 
$
503

 
$
141

Effective income tax rate
33.5
%
 
38.4
%
 
10.1
%

Earning before income tax expense and equity in income (loss) of affiliates 
Earnings from continuing operations before income tax expense by jurisdiction was as follows in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
United States
$
1,507

 
$
1,310

 
$
1,201

Outside the United States
309

 
—

 
186

Earnings from continuing operations before income tax expense
$
1,816

 
$
1,310

 
$
1,387

Components of income tax expense 
Income tax expense was comprised of the following in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Current:
 
 
 
 
 
Federal
$
317

 
$
347

 
$
354

State
37

 
48

 
51

Foreign
54

 
60

 
33

 
408

 
455

 
438

Deferred:
 
 
 
 
 
Federal
163

 
65

 
(275
)
State
21

 
10

 
(26
)
Foreign
17

 
(27
)
 
4

 
201

 
48

 
(297
)
Income tax expense
$
609

 
$
503

 
$
141

Deferred income tax assets and liabilities 
Deferred taxes are the result of differences between the bases of assets and liabilities for financial reporting and income tax purposes. Deferred tax assets and liabilities were comprised of the following ($ in millions):
 
January 28, 2017
 
January 30, 2016
Accrued property expenses
$
91

 
$
175

Other accrued expenses
76

 
78

Deferred revenue
104

 
99

Compensation and benefits
43

 
99

Stock-based compensation
64

 
86

Goodwill and intangibles
210

 
253

Loss and credit carryforwards
123

 
133

Other
59

 
86

Total deferred tax assets
770

 
1,009

Valuation allowance
(94
)
 
(108
)
Total deferred tax assets after valuation allowance
676

 
901

Property and equipment
(240
)
 
(296
)
Inventory
(97
)
 
(69
)
Other
(22
)
 
(26
)
Total deferred tax liabilities
(359
)
 
(391
)
Net deferred tax assets
$
317

 
$
510

Reconciliation of changes in unrecognized tax benefits 
The following table provides a reconciliation of changes in unrecognized tax benefits for fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Balance at beginning of period
$
469

 
$
410

 
$
370

Gross increases related to prior period tax positions
11

 
30

 
33

Gross decreases related to prior period tax positions
(144
)
 
(13
)
 
(88
)
Gross increases related to current period tax positions
55

 
59

 
114

Settlements with taxing authorities
(12
)
 
(9
)
 
(9
)
Lapse of statute of limitations
(5
)
 
(8
)
 
(10
)
Balance at end of period
$
374

 
$
469

 
$
410

Segment and Geographic Information (Tables)
Business segment information 
The following tables present our business segment information in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Revenue
 
 
 
 
 
Domestic
$
36,248

 
$
36,365

 
$
36,055

International
3,155

 
3,163

 
4,284

Total revenue
$
39,403

 
$
39,528

 
$
40,339

Percentage of revenue, by revenue category
 
 
 
 
 
Domestic
 
 
 
 
 
Consumer Electronics
34
%
 
32
%
 
31
%
Computing and Mobile Phones
45
%
 
46
%
 
47
%
Entertainment
7
%
 
8
%
 
9
%
Appliances
9
%
 
8
%
 
7
%
Services
5
%
 
5
%
 
5
%
Other
—
%
 
1
%
 
1
%
Total
100
%
 
100
%
 
100
%
International
 
 
 
 
 
Consumer Electronics
31
%
 
31
%
 
30
%
Computing and Mobile Phones
48
%
 
48
%
 
49
%
Entertainment
7
%
 
9
%
 
9
%
Appliances
6
%
 
5
%
 
5
%
Services
7
%
 
6
%
 
6
%
Other
1
%
 
1
%
 
1
%
Total
100
%
 
100
%
 
100
%
Operating income (loss)
 
 
 
 
 
Domestic(1)
$
1,764

 
$
1,585

 
$
1,437

International
90

 
(210
)
 
13

Total operating income
1,854

 
1,375

 
1,450

Other income (expense)
 
 
 
 
 
Gain on sale of investments
3

 
2

 
13

Investment income and other
31

 
13

 
14

Interest expense
(72
)
 
(80
)
 
(90
)
Earnings from continuing operations before income tax expense
$
1,816

 
$
1,310

 
$
1,387

Assets(2)
 
 
 
 
 
Domestic
$
12,496

 
$
12,318

 
$
12,987

International
1,360

 
1,201

 
2,258

Total assets
$
13,856

 
$
13,519

 
$
15,245

Capital expenditures(2)
 
 
 
 
 
Domestic
$
526

 
$
602

 
$
519

International
56

 
47

 
42

Total capital expenditures
$
582

 
$
649

 
$
561

Depreciation(2)
 
 
 
 
 
Domestic
$
613

 
$
613

 
$
575

International
41

 
44

 
81

Total depreciation
$
654

 
$
657

 
$
656


(1) The Domestic segment operating income includes certain operations, which are based in foreign tax jurisdictions and primarily relate to sourcing products into the U.S.    
(2) For fiscal 2015, the International segment amounts for assets, capital expenditures and depreciation include amounts from Five Star.
Schedule of geographic information 
The following table presents our geographic information in fiscal 2017, 2016 and 2015 ($ in millions):
 
2017
 
2016
 
2015
Net sales to customers
 
 
 
 
 
United States
$
36,248

 
$
36,365

 
$
36,055

Canada
2,899

 
2,917

 
4,047

Other
256

 
246

 
237

Total revenue
$
39,403

 
$
39,528

 
$
40,339

Long-lived assets
 
 
 
 
 
United States
$
2,120

 
$
2,189

 
$
2,100

Canada
156

 
140

 
174

Other
17

 
17

 
21

Total long-lived assets
$
2,293

 
$
2,346

 
$
2,295

Supplementary Financial Information (Unaudited) (Tables)
Schedule of supplementary financial information
The following tables show selected operating results for each 3-month quarter and full year of fiscal 2017 and 2016 (unaudited) ($ in millions):
 
Quarter
 
12-Month
 
1st
 
2nd
 
3rd
 
4th
 
2017
Revenue
$
8,443

 
$
8,533

 
$
8,945

 
$
13,482

 
$
39,403

Comparable sales % change(1)
(0.1
)%
 
0.8
%
 
1.8
%
 
(0.7
)%
 
0.3
%
Gross profit(2)
$
2,145

 
$
2,062

 
$
2,203

 
$
3,030

 
$
9,440

Operating income(3)
372

 
289

 
312

 
881

 
1,854

Net earnings from continuing operations
226

 
182

 
192

 
607

 
1,207

Gain from discontinued operations, net of tax
3

 
16

 
2

 
—

 
21

Net earnings attributable to Best Buy Co., Inc. shareholders
229

 
198

 
194

 
607

 
1,228

Diluted earnings per share(4)
 
 
 
 
 
 
 
 
 
Continuing operations
$
0.69

 
$
0.56

 
$
0.60

 
$
1.91

 
$
3.74

Discontinued operations
0.01

 
0.05

 
0.01

 
—

 
0.07

Diluted earnings per share
$
0.70

 
$
0.61

 
$
0.61

 
$
1.91

 
$
3.81

 
Quarter
 
12-Month
 
1st
 
2nd
 
3rd
 
4th
 
2016
Revenue
$
8,558

 
$
8,528

 
$
8,819

 
$
13,623

 
$
39,528

Comparable sales % change(1)
0.6
%
 
3.8
%
 
0.8
%
 
(1.7
)%
 
0.5
%
Gross profit(5)
$
2,030

 
$
2,098

 
$
2,112

 
$
2,951

 
$
9,191

Operating income(6)
86

 
288

 
230

 
771

 
1,375

Net earnings from continuing operations
37

 
164

 
129

 
477

 
807

Gain (loss) from discontinued operations, net of tax
92

 
—

 
(4
)
 
2

 
90

Net earnings attributable to Best Buy Co., Inc. shareholders
129

 
164

 
125

 
479

 
897

Diluted earnings (loss) per share(4)
 
 
 
 
 
 
 
 
 
Continuing operations
$
0.10

 
$
0.46

 
$
0.37

 
$
1.39

 
$
2.30

Discontinued operations
0.26

 
—

 
(0.01
)
 
0.01

 
0.26

Diluted earnings per share
$
0.36

 
$
0.46

 
$
0.36

 
$
1.40

 
$
2.56

(1)
Our comparable sales calculation compares revenue from stores, websites and call centers operating for at least 14 full months, as well as revenue related to certain other comparable sales channels for a particular period to the corresponding period in the prior year. Relocated stores, as well as remodeled, expanded and downsized stores closed more than 14 days, are excluded from our comparable sales calculation until at least 14 full months after reopening. Acquisitions are included in the comparable sales calculation beginning with the first full quarter following the first anniversary of the date of the acquisition. The Canadian brand consolidation, which included the permanent closure of 66 Future Shop stores, the conversion of 65 Future Shop stores to Best Buy stores and the elimination of the Future Shop website, had a material impact on a year-over-year basis on the remaining Canadian retail stores and the website. As such, from the first quarter of fiscal 2016 through the third quarter of fiscal 2017, all Canadian store and website revenue was removed from the comparable sales base and the International segment no longer had a comparable metric. Therefore, Consolidated comparable sales equaled the Domestic segment comparable sales. Beginning in the fourth quarter of fiscal 2017, we resumed reporting International comparable sales as revenue in the International segment was once again deemed to be comparable and, as such, Consolidated comparable sales are once again equal to the aggregation of Domestic and International comparable sales.
(2)
Includes $183 million of cathode ray tube ("CRT") litigation settlements reached and recorded in the fiscal first quarter and $183 million for the 12 months ended January 28, 2017, related to products purchased and sold in prior fiscal years.
(3)
Includes $29 million, $0 million, $1 million and $9 million of restructuring charges recorded in the fiscal first, second, third and fourth quarters, respectively, and $39 million for the 12 months ended January 28, 2017, related to measures we took to restructure our businesses. Also, includes $161 million of cathode ray tube litigation settlements, net of related legal fees and costs, recorded in the fiscal first quarter and in the 12 months ended January 28, 2017, related to products purchased and sold in prior fiscal years.
(4)
The sum of our quarterly diluted earnings per share does not equal our annual diluted earnings per share due to differences in quarterly and annual weighted-average shares outstanding.
(5)
Includes $78 million, $10 million, $0 million and $2 million of CRT and LCD litigation settlements reached and recorded in the fiscal first, second, third and fourth quarters respectively, and $90 million for the 12 months ended January 30, 2016, related to products purchased and sold in prior fiscal years.
(6)
Includes $186 million, $(4) million, $7 million and $12 million of restructuring charges recorded in the fiscal first, second, third and fourth quarters, respectively, and $201 million for the 12 months ended January 30, 2016, related to measures we took to restructure our businesses. Also, includes $67 million, $8 million, $0 million and $2 million of CRT and LCD litigation settlements, net of related legal fees and costs, recorded in the fiscal first, second, third and fourth quarters respectively, and $77 million for the 12 months ended January 30, 2016, related to products purchased and sold in prior fiscal years.
Summary of Significant Accounting Policies - Description of Business (Details)
12 Months Ended
Jan. 28, 2017
segments
Accounting Policies [Abstract]
 
Number of Operating Segments
2 
Summary of Significant Accounting Policies - Basis of Presentation (Details)
12 Months Ended
Jan. 28, 2017
Accounting Policies [Abstract]
 
Period of Expiration for Customer Loyalty Certificates, High End of Range
12 months 
Reporting Lag for Certain Foreign Operations in Financial Statements
1 month 
Summary of Significant Accounting Policies - Fiscal Year (Details)
12 Months Ended
Jan. 28, 2017
Fiscal Year [Abstract]
 
Number of Weeks in Fiscal Period
52 
Summary of Significant Accounting Policies - Cash & Cash Equivalents (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Accounting Policies [Abstract]
 
 
Maximum Term of Original Maturity to Classify an Instrument as Cash Equivalents
 
3 months 
Cash Equivalents, at Carrying Value
$ 1,531 
$ 1,208 
Weighted Average Interest Rate on Cash Equivalents
0.50% 
0.50% 
Summary of Significant Accounting Policies - Receivables (Details) (USD $)
In Millions, unless otherwise specified
Jan. 28, 2017
Jan. 30, 2016
Accounting Policies [Abstract]
 
 
Valuation Allowances and Reserves, Balance
$ 52 
$ 49 
Summary of Significant Accounting Policies - Restricted Assets (Details) (USD $)
In Millions, unless otherwise specified
Jan. 28, 2017
Jan. 30, 2016
Accounting Policies [Abstract]
 
 
Restricted Cash and Investments
$ 193 
$ 185 
Summary of Significant Accounting Policies - PP&E (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Property, Plant and Equipment [Line Items]
 
 
Capital Leases, Balance Sheet, Assets by Major Class, Net
$ 166 
$ 165 
Capital Leases, Lessee Balance Sheet, Assets by Major Class, Accumulated Depreciation
134 
107 
Fully depreciated assets no longer in service
$ 345 
 
Building [Member]
 
 
Property, Plant and Equipment [Line Items]
 
 
Estimated useful lives, minimum (in years)
5 years 
 
Estimated useful lives, maximum (in years)
35 years 
 
Leasehold Improvements [Member]
 
 
Property, Plant and Equipment [Line Items]
 
 
Estimated useful lives, minimum (in years)
3 years 
 
Estimated useful lives, maximum (in years)
15 years 
 
Fixtures and Equipment [Member]
 
 
Property, Plant and Equipment [Line Items]
 
 
Estimated useful lives, minimum (in years)
2 years 
 
Estimated useful lives, maximum (in years)
15 years 
 
Assets Held under Capital Leases [Member]
 
 
Property, Plant and Equipment [Line Items]
 
 
Estimated useful lives, minimum (in years)
4 years 
 
Estimated useful lives, maximum (in years)
5 years 
 
Summary of Significant Accounting Policies - Impairment of PPE & Exit Activities (Details) (USD $)
In Millions, unless otherwise specified
Jan. 28, 2017
Jan. 30, 2016
Accounting Policies [Abstract]
 
 
Asset Retirement Obligation, Current
$ 29 
$ 44 
Asset Retirement Obligations, Noncurrent
$ 37 
$ 54 
Summary of Significant Accounting Policies - Leases (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Accounting Policies [Abstract]
 
 
Term of Lease Agreements, Low End of Range
10 years 
 
Term of Lease Agreements, High End of Range
20 years 
 
Deferred Rent Credit, Current
$ 33 
$ 36 
Deferred Rent Credit, Noncurrent
121 
139 
Financing Lease Obligations
$ 177 
$ 178 
Summary of Significant Accounting Policies - Goodwill & Indefinite Intangible (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 30, 2016
Jan. 31, 2015
Jan. 28, 2017
Feb. 1, 2014
Goodwill [Roll Forward]
 
 
 
 
Goodwill, balance at the beginning of the period
 
 
$ 425 
 
Goodwill, balance at the end of the period
425 
 
425 
 
Indefinite-lived Intangible Assets [Roll Forward]
 
 
 
 
Goodwill, Gross
1,100 1
 
1,100 
 
Cumulative Impairment
(675)1
 
(675)
 
Domestic Segment [Member]
 
 
 
 
Goodwill [Roll Forward]
 
 
 
 
Goodwill written off related to sale of business
 
0 2
 
 
Indefinite-lived Intangible Assets [Roll Forward]
 
 
 
 
Intangible written off related to sale of business
 
0 2
 
 
Total Operations [Member]
 
 
 
 
Indefinite-lived Intangible Assets [Roll Forward]
 
 
 
 
Indefinite-Lived Intangible Assets (Excluding Goodwill)
18 
57 
18 
101 
Tradename, impairments
 
(1)
 
 
Intangible written off related to sale of business
(40)3
(37)2
 
 
Intangible changes in foreign currency exchange rates
(1)
 
 
 
Indefinite-Lived Intangible Assets, Other
 
(6)
 
 
Total Operations [Member] |
International [Member]
 
 
 
 
Indefinite-lived Intangible Assets [Roll Forward]
 
 
 
 
Indefinite-Lived Intangible Assets (Excluding Goodwill)
0 
39 
0 
82 
Tradename, impairments
 
0 
 
 
Intangible written off related to sale of business
(40)3
(37)2
 
 
Intangible changes in foreign currency exchange rates
(1)
(6)
 
 
Total Operations [Member] |
Domestic Segment [Member]
 
 
 
 
Goodwill [Roll Forward]
 
 
 
 
Goodwill, balance at the beginning of the period
425 
425 
425 
 
Goodwill impairments
 
0 
 
 
Goodwill written off related to sale of business
0 3
 
 
 
Goodwill changes in foreign currency exchange rates
0 
0 
 
 
Goodwill, balance at the end of the period
425 
425 
425 
 
Indefinite-lived Intangible Assets [Roll Forward]
 
 
 
 
Indefinite-Lived Intangible Assets (Excluding Goodwill)
18 
18 
18 
19 
Intangible acquisitions
0 3
 
 
 
Tradename, impairments
 
(1)
 
 
Intangible changes in foreign currency exchange rates
$ 0 
$ 0 
 
 
Summary of Significant Accounting Policies - Insurance (Details) (USD $)
In Millions, unless otherwise specified
Jan. 28, 2017
Jan. 30, 2016
Accounting Policies [Abstract]
 
 
Self-insured liabilities included in accrued liabilities
$ 65 
$ 62 
Self-insured liabilities included in long-term liabilities
63 
54 
Self insurance reserve
$ 128 
$ 116 
Summary of Significant Accounting Policies - Foreign Currency (Details)
12 Months Ended
Jan. 28, 2017
Accounting Policies [Abstract]
 
Prior Period Foreign Currency Exchange Rate, Used to Align Operations Reported
1 month 
Summary of Significant Accounting Policies - Revenue (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Accounting Policies [Abstract]
 
 
 
Sales returns reserve
$ 28 
$ 25 
 
Deferred revenue
418 
357 
 
Deferred revenue, noncurrent
34 
45 
 
Percentage of Commissions on Sale of Extended Warranties to Revenue
2.20% 
2.30% 
2.10% 
Profit Share on Sale of Extended Warranties
$ 133 
$ 158 
$ 19 
Summary of Significant Accounting Policies - Gift Cards (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Accounting Policies [Abstract]
 
 
 
Gift Card Redeemability, Determination Period
24 months 
 
 
Gift card breakage income
$ 37 
$ 46 
$ 19 
Summary of Significant Accounting Policies - Customer Loyalty Programs (Details)
12 Months Ended
Jan. 28, 2017
Accounting Policies [Abstract]
 
Period of Expiration for Customer Loyalty Certificates, Low End of Range
2 months 
Period of Expiration for Customer Loyalty Certificates, High End of Range
12 months 
Summary of Significant Accounting Policies - Advertising Costs (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Accounting Policies [Abstract]
 
 
 
Advertising expense
$ 743 
$ 742 
$ 711 
Discontinued Operations Discontinued Operations (Details) (USD $)
In Millions, unless otherwise specified
Jan. 30, 2016
Discontinued Operations and Disposal Groups [Abstract]
 
Disposal Group, Including Discontinued Operation, Property, Plant and Equipment
$ 31 
Discontinued Operations (Details 2) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 28, 2017
Oct. 29, 2016
Jul. 30, 2016
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax
 
 
 
 
 
 
 
 
$ 16 
 
 
Revenue
 
 
 
 
 
 
 
 
0 
217 
1,564 
Restructuring charges
 
 
 
 
 
 
 
 
0 1
1 1
18 1
Gain (loss) from discontinued operations before income tax benefit
 
 
 
 
 
 
 
 
28 
(8)
(12)
Income tax expense
 
 
 
 
 
 
 
 
(7)
(1)
0 
Gain on sale of discontinued operations
 
 
 
 
 
 
 
 
0 
99 
1 
Net gain (loss) from discontinued operations including noncontrolling interests
0 
2 
16 
3 
2 
(4)
0 
92 
21 
90 
(11)
Net (earnings) loss from discontinued operations attributable to noncontrolling interests
 
 
 
 
 
 
 
 
0 
0 
(2)
Net gain (loss) from discontinued operations attributable to Best Buy Co., Inc.
 
 
 
 
 
 
 
 
21 
90 
(13)
Derivative, Notional Amount
$ 998 
 
 
 
$ 1,052 
 
 
 
$ 998 
$ 1,052 
 
Fair Value Measurements (Details) (Fair Value, Measurements, Recurring [Member], USD $)
In Millions, unless otherwise specified
Jan. 28, 2017
Jan. 30, 2016
Cash and Cash Equivalents [Member] |
Fair Value, Inputs, Level 1 [Member] |
Money Market Funds [Member]
 
 
ASSETS
 
 
Cash and cash equivalents
$ 290 
$ 51 
Cash and Cash Equivalents [Member] |
Fair Value, Inputs, Level 2 [Member] |
Commercial Paper [Member]
 
 
ASSETS
 
 
Cash and cash equivalents
0 
265 
Cash and Cash Equivalents [Member] |
Fair Value, Inputs, Level 2 [Member] |
Bank Time Deposits [Member]
 
 
ASSETS
 
 
Cash and cash equivalents
15 
306 
Short-term Investments [Member] |
Fair Value, Inputs, Level 2 [Member] |
Corporate Bond Securities [Member]
 
 
ASSETS
 
 
Short-term investments
0 
193 
Short-term Investments [Member] |
Fair Value, Inputs, Level 2 [Member] |
Commercial Paper [Member]
 
 
ASSETS
 
 
Short-term investments
349 
122 
Short-term Investments [Member] |
Fair Value, Inputs, Level 2 [Member] |
Bank Time Deposits [Member]
 
 
ASSETS
 
 
Short-term investments
1,332 
990 
Other Current Assets [Member] |
Fair Value, Inputs, Level 1 [Member] |
Money Market Funds [Member]
 
 
ASSETS
 
 
Other Current Assets, Fair Value Disclosure
7 
0 
Other Current Assets [Member] |
Fair Value, Inputs, Level 2 [Member] |
Commercial Paper [Member]
 
 
ASSETS
 
 
Other Current Assets, Fair Value Disclosure
60 
0 
Other Current Assets [Member] |
Fair Value, Inputs, Level 2 [Member] |
Bank Time Deposits [Member]
 
 
ASSETS
 
 
Other Current Assets, Fair Value Disclosure
100 
79 
Other Current Assets [Member] |
Fair Value, Inputs, Level 2 [Member] |
Foreign Exchange and Other Derivative Financial Instruments [Member]
 
 
ASSETS
 
 
Other Current Assets, Fair Value Disclosure
2 
18 
Other Assets [Member] |
Fair Value, Inputs, Level 1 [Member] |
Marketable securities that fund deferred compensation [Member]
 
 
ASSETS
 
 
Other Assets, Fair Value Disclosure
96 
96 
Other Assets [Member] |
Fair Value, Inputs, Level 2 [Member] |
Interest Rate Swap [Member]
 
 
ASSETS
 
 
Other Assets, Fair Value Disclosure
13 
25 
Other Assets [Member] |
Fair Value, Inputs, Level 3 [Member] |
Auction Rate Securities [Member]
 
 
ASSETS
 
 
Other Assets, Fair Value Disclosure
0 
2 
Accrued Liabilities [Member] |
Fair Value, Inputs, Level 2 [Member] |
Foreign Exchange and Other Derivative Financial Instruments [Member]
 
 
ASSETS
 
 
Accrued Liabilities, Fair Value Disclosure
$ 3 
$ 1 
Fair Value Measurements - Impairments (Details) (Continuing Operations [Member], Fair Value, Measurements, Nonrecurring [Member], Fair Value, Inputs, Level 3 [Member], USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Property and equipment, impairments
$ 28 
$ 61 
Property and equipment, remaining net carrying value
0 1
15 1
Restructuring, Settlement and Impairment Provisions
36 
131 
Total remaining net carrying value
0 1
15 1
Property and equipment write-downs [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Impairment of Long-Lived Assets Held-for-use
8 2
 
Property and equipment, impairments
 
30 2
Property and equipment, remaining net carrying value
0 
0 
Investments Impairment Charge Related to Restructuring [Member]
 
 
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
Tradename, impairments
0 2
40 
Tradename, remaining net carrying value
$ 0 
$ 0 
Restructuring Charges Summary (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 28, 2017
Oct. 29, 2016
Jul. 30, 2016
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
$ 39 
$ 198 
$ 5 
Restructuring charges
9 
1 
0 
29 
12 
7 
(4)
186 
39 
201 
23 
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Vacant Space Reserve
34 
 
 
 
66 
 
 
 
34 
66 
0 
Restructuring Program 2013 Renew Blue [Member] [Domain]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Charges, Continuing Operations
 
 
 
 
 
 
 
 
0 
(1)
10 
Employee Severance [Member] |
Restructuring Program Renew Blue Phase 2 [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Vacant Space Reserve
0 
 
 
 
0 
 
 
 
0 
0 
 
Restructuring charges
 
 
 
 
 
 
 
 
19 
 
 
Employee Severance [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Vacant Space Reserve
0 
 
 
 
2 
 
 
 
0 
2 
0 
Employee Severance [Member] |
Restructuring Program 2013 Renew Blue [Member] [Domain]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Vacant Space Reserve
0 
 
 
 
 
 
 
 
0 
 
 
Facility Closing [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Vacant Space Reserve
34 
 
 
 
64 
 
 
 
34 
64 
0 
Facility Closing [Member] |
Restructuring Program 2013 Renew Blue [Member] [Domain]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Vacant Space Reserve
9 
 
 
 
 
 
 
 
9 
 
 
Facility Closing [Member] |
Other Restructuring [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Vacant Space Reserve
14 
 
 
 
 
 
 
 
14 
 
 
International [Member] |
Restructuring Program 2013 Renew Blue [Member] [Domain]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Charges, Continuing Operations
 
 
 
 
 
 
 
 
5 
 
 
International [Member] |
Restructuring Program 2013 Renew Blue [Member] [Domain]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Charges, Continuing Operations
 
 
 
 
 
 
 
 
 
(1)
1 
Continuing Operations [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
39 
201 
5 
Restructuring charges
 
 
 
 
 
 
 
 
39 
201 
 
Continuing Operations [Member] |
Restructuring Program Renew Blue Phase 2 [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
26 
0 
0 
Restructuring charges
 
 
 
 
 
 
 
 
26 
 
 
Continuing Operations [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
200 
 
 
Continuing Operations [Member] |
Restructuring Program 2013 Renew Blue [Member] [Domain]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
5 1
(2)1
11 1
Continuing Operations [Member] |
Other Restructuring [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
5 2
3 2
(6)2
Continuing Operations [Member] |
Employee Severance [Member] |
Restructuring Program Renew Blue Phase 2 [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
18 
 
 
Continuing Operations [Member] |
International [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
3 
200 
0 
Restructuring charges
 
 
 
 
 
 
 
 
 
200 
 
Continuing Operations [Member] |
International [Member] |
Employee Severance [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 
25 
 
Continuing Operations [Member] |
International [Member] |
Facility Closing [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
3 
102 
 
Discontinued Operations [Member] |
Restructuring Program 2013 Renew Blue [Member] [Domain]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
$ 0 1
$ 0 1
$ 18 1
[1] Represents activity related to our remaining termination benefits and vacant space liabilities, primarily in our International segment, for our Renew Blue restructuring program, which began in the fourth quarter of fiscal 2013. Continuing operations charges related to the Domestic segment were $0 million, benefit of $1 million and $10 million for fiscal 2017, 2016 and 2015, respectively; and to the International segment were $5 million, benefit of $1 million and $1 million for fiscal 2017, 2016 and 2015, respectively. All discontinued operations charges related to the International segment. As of January 28, 2017, the termination benefits liability was $0 million and the remaining vacant space liability was $9 million. We may continue to incur immaterial adjustments to the vacant space liability for charges in sublease assumptions or potential lease buyouts. In addition, lease payments for vacated stores will continue until leases expire or are terminated.
Restructuring Charges Canadian Brand Consolidation (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 28, 2017
Oct. 29, 2016
Jul. 30, 2016
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
$ 39 
$ 198 
$ 5 
Restructuring charges
9 
1 
0 
29 
12 
7 
(4)
186 
39 
201 
23 
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Number of Stores to be Closed
 
 
 
 
 
 
 
 
66 
 
 
Payments for Restructuring
 
 
 
 
 
 
 
 
(39)
(71)
 
Restructuring Reserve, Accrual Adjustment
 
 
 
 
 
 
 
 
2 1
3 1
 
Restructuring Reserve, Translation Adjustment
 
 
 
 
 
 
 
 
4 
(7)
 
Restructuring Reserve
34 
 
 
 
66 
 
 
 
34 
66 
0 
Restructuring Charges, Rollforward
 
 
 
 
 
 
 
 
1 
141 
 
Number of Future Shop stores converted to Best Buy stores
 
 
 
 
 
 
 
 
65 
 
 
Employee Severance [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Payments for Restructuring
 
 
 
 
 
 
 
 
(2)
(24)
 
Restructuring Reserve, Accrual Adjustment
 
 
 
 
 
 
 
 
0 1
(2)1
 
Restructuring Reserve, Translation Adjustment
 
 
 
 
 
 
 
 
0 
0 
 
Restructuring Reserve
0 
 
 
 
2 
 
 
 
0 
2 
0 
Restructuring Charges, Rollforward
 
 
 
 
 
 
 
 
0 
28 
 
Facility Closing [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Payments for Restructuring
 
 
 
 
 
 
 
 
(37)
(47)
 
Restructuring Reserve, Accrual Adjustment
 
 
 
 
 
 
 
 
2 1
5 1
 
Restructuring Reserve, Translation Adjustment
 
 
 
 
 
 
 
 
4 
(7)
 
Restructuring Reserve
34 
 
 
 
64 
 
 
 
34 
64 
0 
Restructuring Charges, Rollforward
 
 
 
 
 
 
 
 
1 
113 
 
Continuing Operations [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
39 
201 
5 
Restructuring charges
 
 
 
 
 
 
 
 
39 
201 
 
Continuing Operations [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
200 
 
 
Continuing Operations [Member] |
International [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
3 
200 
0 
Restructuring charges
 
 
 
 
 
 
 
 
 
200 
 
Continuing Operations [Member] |
International [Member] |
Inventory write-downs [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 
3 
 
Continuing Operations [Member] |
International [Member] |
Property and equipment write-downs [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 
30 
 
Continuing Operations [Member] |
International [Member] |
Tradename Impairment [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 
40 
 
Continuing Operations [Member] |
International [Member] |
Employee Severance [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 
25 
 
Continuing Operations [Member] |
International [Member] |
Facility Closing [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
$ 3 
$ 102 
 
Restructuring Charges Renew Blue Plan (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 28, 2017
Oct. 29, 2016
Jul. 30, 2016
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
$ 39 
$ 198 
$ 5 
Restructuring charges
9 
1 
0 
29 
12 
7 
(4)
186 
39 
201 
23 
Continuing Operations [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
39 
201 
5 
Restructuring charges
 
 
 
 
 
 
 
 
39 
201 
 
Restructuring Program 2013 Renew Blue [Member] [Domain] |
Employee Severance [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Reserve
0 
 
 
 
 
 
 
 
0 
 
 
Restructuring Program 2013 Renew Blue [Member] [Domain] |
Facility Closing [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Reserve
9 
 
 
 
 
 
 
 
9 
 
 
Restructuring Program 2013 Renew Blue [Member] [Domain] |
Continuing Operations [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
5 1
(2)1
11 1
Restructuring Program 2013 Renew Blue [Member] [Domain] |
Discontinued Operations [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 1
0 1
18 1
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Reserve
34 
 
 
 
66 
 
 
 
34 
66 
0 
Restructuring Charges, Rollforward
 
 
 
 
 
 
 
 
1 
141 
 
Payments for Restructuring
 
 
 
 
 
 
 
 
(39)
(71)
 
Restructuring Reserve, Accrual Adjustment
 
 
 
 
 
 
 
 
(2)2
(3)2
 
Restructuring Reserve, Translation Adjustment
 
 
 
 
 
 
 
 
4 
(7)
 
Restructuring Program Canadian Brand Consolidation [Member] |
Employee Severance [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Reserve
0 
 
 
 
2 
 
 
 
0 
2 
0 
Restructuring Charges, Rollforward
 
 
 
 
 
 
 
 
0 
28 
 
Payments for Restructuring
 
 
 
 
 
 
 
 
(2)
(24)
 
Restructuring Reserve, Accrual Adjustment
 
 
 
 
 
 
 
 
0 2
2 2
 
Restructuring Reserve, Translation Adjustment
 
 
 
 
 
 
 
 
0 
0 
 
Restructuring Program Canadian Brand Consolidation [Member] |
Facility Closing [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Reserve
34 
 
 
 
64 
 
 
 
34 
64 
0 
Restructuring Charges, Rollforward
 
 
 
 
 
 
 
 
1 
113 
 
Payments for Restructuring
 
 
 
 
 
 
 
 
(37)
(47)
 
Restructuring Reserve, Accrual Adjustment
 
 
 
 
 
 
 
 
(2)2
(5)2
 
Restructuring Reserve, Translation Adjustment
 
 
 
 
 
 
 
 
4 
(7)
 
Restructuring Program Canadian Brand Consolidation [Member] |
Continuing Operations [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
200 
 
 
Restructuring Program Canadian Brand Consolidation [Member] |
Continuing Operations [Member] |
International [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
3 
200 
0 
Restructuring charges
 
 
 
 
 
 
 
 
 
200 
 
Restructuring Program Canadian Brand Consolidation [Member] |
Continuing Operations [Member] |
International [Member] |
Inventory write-downs [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 
3 
 
Restructuring Program Canadian Brand Consolidation [Member] |
Continuing Operations [Member] |
International [Member] |
Property and equipment write-downs [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 
30 
 
Restructuring Program Canadian Brand Consolidation [Member] |
Continuing Operations [Member] |
International [Member] |
Tradename Impairment [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 
40 
 
Restructuring Program Canadian Brand Consolidation [Member] |
Continuing Operations [Member] |
International [Member] |
Employee Severance [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
0 
25 
 
Restructuring Program Canadian Brand Consolidation [Member] |
Continuing Operations [Member] |
International [Member] |
Facility Closing [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
$ 3 
$ 102 
 
[1] Represents activity related to our remaining termination benefits and vacant space liabilities, primarily in our International segment, for our Renew Blue restructuring program, which began in the fourth quarter of fiscal 2013. Continuing operations charges related to the Domestic segment were $0 million, benefit of $1 million and $10 million for fiscal 2017, 2016 and 2015, respectively; and to the International segment were $5 million, benefit of $1 million and $1 million for fiscal 2017, 2016 and 2015, respectively. All discontinued operations charges related to the International segment. As of January 28, 2017, the termination benefits liability was $0 million and the remaining vacant space liability was $9 million. We may continue to incur immaterial adjustments to the vacant space liability for charges in sublease assumptions or potential lease buyouts. In addition, lease payments for vacated stores will continue until leases expire or are terminated.
Restructuring Charges Renew Blue Phase 2 (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 28, 2017
Oct. 29, 2016
Jul. 30, 2016
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
$ 9 
$ 1 
$ 0 
$ 29 
$ 12 
$ 7 
$ (4)
$ 186 
$ 39 
$ 201 
$ 23 
Restructuring charges
 
 
 
 
 
 
 
 
39 
198 
5 
Employee Severance [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Reserve
0 
 
 
 
0 
 
 
 
0 
0 
 
Restructuring charges
 
 
 
 
 
 
 
 
19 
 
 
Payments for Restructuring
 
 
 
 
 
 
 
 
(17)
 
 
Restructuring Reserve, Accrual Adjustment
 
 
 
 
 
 
 
 
(2)
 
 
Continuing Operations [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
39 
201 
 
Restructuring charges
 
 
 
 
 
 
 
 
39 
201 
5 
Continuing Operations [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
26 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
26 
0 
0 
Continuing Operations [Member] |
Property and equipment write-downs [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
8 
 
 
Continuing Operations [Member] |
Employee Severance [Member] |
Restructuring Program Canadian Brand Consolidation [Member]
 
 
 
 
 
 
 
 
 
 
 
Restructuring Cost and Reserve [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
$ 18 
 
 
Debt - Short-Term Debt (Details) (USD $)
Jan. 28, 2017
U.S. revolving credit facility [Member]
 
Short-term Debt
 
Line of credit facility, amount outstanding
$ 0 
U.S. revolving credit facility - Five-Year [Member]
 
Short-term Debt
 
Line of Credit Facility, Previous Borrowing Capacity
1,250,000,000 
Line of credit facility, current borrowing capacity
$ 1,250,000,000 
Debt instrument, basis spread on federal funds rate (as a percent)
0.50% 
Debt instrument, basis spread on LIBOR (as a percent)
1.00% 
Debt instrument, lower range on ABR (as a percent)
0.00% 
Debt instrument, higher range on ABR (as a percent)
0.50% 
LIBOR margin, low end of the range (as a percent)
0.90% 
LIBOR margin, high end of the range (as a percent)
1.50% 
Debt instrument, lower range on facility fee (as a percent)
0.10% 
Debt instrument, higher range on facility fee (as a percent)
0.25% 
Debt - Long-Term Debt (Details) (USD $)
In Millions, unless otherwise specified
1 Months Ended 12 Months Ended 1 Months Ended 12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Mar. 31, 2011
2016 and 2021 Notes [Member]
Jan. 28, 2017
2016 and 2021 Notes [Member]
Jan. 28, 2017
2016 Notes [Member]
Jan. 30, 2016
2016 Notes [Member]
Mar. 31, 2011
2016 Notes [Member]
Jul. 31, 2013
Notes due 2018 [Member]
Jan. 28, 2017
Notes due 2018 [Member]
Jan. 30, 2016
Notes due 2018 [Member]
Jul. 16, 2013
Notes due 2018 [Member]
Jan. 28, 2017
2021 Notes [Member]
Jan. 30, 2016
2021 Notes [Member]
Mar. 31, 2011
2021 Notes [Member]
Jan. 28, 2017
Interest Rate Swap [Member]
Jan. 30, 2016
Interest Rate Swap [Member]
Jan. 28, 2017
Capital Lease Obligations [Member]
Jan. 30, 2016
Capital Lease Obligations [Member]
Jan. 28, 2017
Debt discounts and issuance costs [Member]
Jan. 30, 2016
Debt discounts and issuance costs [Member]
Jan. 28, 2017
Notes due 2018 [Member]
Long-term Debt.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total long-term debt
$ (1,163)
$ (1,525)
 
 
$ 0 
$ (350)
 
 
$ (500)
$ (500)
 
$ (650)
$ (650)
 
$ (13)
$ (25)
$ (30)
$ (38)
$ (5)
$ (7)
 
Financing Lease Obligations
177 
178 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt and Capital Lease Obligations, Including Current Maturities
1,365 
1,734 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Less: current portion
(44)
(395)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term Debt, Excluding Current Maturities
1,321 
1,339 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long-term debt, fair value
1,240 
1,543 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument issued, principal amount
 
 
 
 
 
 
350 
 
 
 
500 
 
 
650 
 
 
 
 
 
 
 
Interest rate (as a percent)
 
 
 
 
3.75% 
 
 
 
 
 
5.00% 
5.50% 
 
 
 
 
 
 
 
 
 
Underwriting discounts
 
 
6 
 
 
 
 
5 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net proceeds from the sale of the Notes
 
 
990 
 
 
 
 
495 
 
 
 
 
 
 
 
 
 
 
 
 
 
Redemption price, as percentage of principal amount of debt instrument (as a percent)
 
 
 
100.00% 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
100.00% 
Debt Instrument, Treasury Rate Basis Points for Redemption
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
50 
Redemption price upon control triggering event, percentage of principal amount (as a percent)
 
 
 
101.00% 
 
 
 
 
101.00% 
 
 
 
 
 
 
 
 
 
 
 
 
Future maturities of long-term debt, including capitalized leases
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2018
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2019
511 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2020
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2021
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2022
652 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Thereafter
$ 0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Derivative Instruments Derivative Instruments (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Derivatives, Fair Value [Line Items]
 
 
Derivative Asset, Fair Value, Gross Asset
$ 15 
$ 43 
Derivative Liability, Fair Value, Gross Liability
3 
1 
Derivative, Gain (Loss) on Derivative, Net
0 
0 
Derivative, Notional Amount
998 
1,052 
Net Investment Hedging [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Derivative, Term of Contract
12 months 
 
Derivative Asset, Fair Value, Gross Asset
2 1
15 1
Derivative Liability, Fair Value, Gross Liability
2 1
1 1
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, before Tax
(14)
21 
Derivative, Notional Amount
205 
208 
Interest Rate Swaption [Member] |
Debt [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Derivative, Loss on Derivative
(12)
(23)
Interest Rate Swap [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Derivative Asset, Fair Value, Gross Asset
13 2
25 2
Derivative Liability, Fair Value, Gross Liability
0 
0 
Derivative, Notional Amount
750 
750 
Interest Rate Swap [Member] |
Interest Expense [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Derivative, Gain on Derivative
(12)
(23)
Foreign Exchange Forward [Member] |
Not Designated as Hedging Instrument [Member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Derivative, Term of Contract
12 months 
 
Derivative Asset, Fair Value, Gross Asset
0 1
3 1
Derivative Liability, Fair Value, Gross Liability
1 1
0 1
Gain (Loss) on Foreign Currency Derivative Instruments Not Designated as Hedging Instruments
(3)
4 
Derivative, Notional Amount
$ 43 
$ 94 
Shareholders' Equity (Details) (USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Exercisable Options, Weighted Average Remaining Contractual Term
3 years 6 months 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Weighted Average Remaining Contractual Term
4 years 3 months 
 
 
Number of shares authorized under the Omnibus Plan (in shares)
22,500,000 
 
 
Number of shares available for future grants under the Omnibus Plan (in shares)
14,600,000 
 
 
Stock-based compensation
$ 108 
$ 104 
$ 87 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
 
 
 
Outstanding at the beginning of the period (in shares)
14,242,000 
 
 
Granted (in shares)
224,000 
 
 
Stock Granted, Value, Share-based Compensation, Forfeited
$ 48.13 
 
 
Outstanding at the end of the period (in shares)
6,987,000 
14,242,000 
 
Stock options exercised (in shares)
(5,273,000)
 
 
Weighted Average Exercise Price [Roll Forward]
 
 
 
Outstanding at the beginning of the period (in dollars per share)
$ 36.51 
 
 
Granted (in dollars per share)
$ 31.29 
 
 
Outstanding at the end of the period (in dollars per share)
$ 36.61 
$ 36.51 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested Options Forfeited, Number of Shares
(2,206,000)
 
 
Weighted Average Remaining Contractual Term, Years [Abstract]
 
 
 
Outstanding at the end of the period (in years)
4 years 3 months 
 
 
Aggregate Intrinsic Value [Abstract]
 
 
 
Outstanding at the end of the period (in dollars)
54 
 
 
Weighted-average grant-date fair value of stock options granted (in dollars per share)
$ 8.04 
$ 11.59 
$ 9.09 
Aggregate intrinsic value of stock options exercised (in dollars)
55 
14 
13 
Net cash proceeds from the exercise of stock options (in dollars)
164 
40 
42 
Actual income tax benefit realized from stock option exercises (in dollars)
19 
5 
5 
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
 
 
 
Risk-free interest rate low end of the range (as a percent)
0.10% 1 2
0.10% 1 2
0.10% 1 2
Risk-free interest rate high end of the range (as a percent)
2.10% 1 2
2.40% 1 2
1.80% 1 2
Expected dividend yield (as a percent)
3.50% 1
2.30% 1
2.50% 1
Fair Value Assumptions, Expected Volatility Rate
37.00% 1
37.00% 1
40.00% 1
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term
6 years 0 months 
6 years 0 months 
6 years 0 months 
Weighted Average Fair Value Per Share [Roll Forward]
 
 
 
Granted (in dollars per share)
$ 31.79 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Aggregate Intrinsic Value
54 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Intrinsic Value
46 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number
6,987,000 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Weighted Average Exercise Price
$ 36.61 
 
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Number of Exercisable Options
5,858,000 
 
 
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Exercisable Options, Weighted Average Exercise Price
$ 36.63 
 
 
Employee Stock [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Issuance of common stock under employee stock purchase plan (in shares)
200,000 
200,000 
300,000 
Discounted purchase rate on the market price of the stock (as a percent)
5.00% 
5.00% 
5.00% 
Weighted Average Fair Value Per Share [Roll Forward]
 
 
 
Amount accumulated by plan participants to purchase common stock (in dollars)
2 
2 
 
Performance-Based Share Awards [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Stock-based compensation expense (in dollars)
6 
 
0 
Stock-based compensation
 
0 
 
Aggregate Intrinsic Value [Abstract]
 
 
 
Unrecognized compensation (in dollars)
5 
 
 
Weighted-average period over which compensation expense is expected to be recognized (in years)
1 year 9 months 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested [Roll Forward]
 
 
 
Outstanding at the beginning of the period (in shares)
0 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period
(75,000)
 
 
Outstanding at the end of the period (in shares)
438,000 
0 
 
Weighted Average Fair Value Per Share [Roll Forward]
 
 
 
Outstanding at the beginning of the period (in dollars per share)
$ 0.00 
 
 
Granted (in dollars per share)
$ 29.08 
 
 
Outstanding at the end of the period (in dollars per share)
$ 28.98 
$ 0.00 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value
$ 29.66 
 
 
Market-based [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Granted
1,088,000 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost
15 
16 
10 
Aggregate Intrinsic Value [Abstract]
 
 
 
Unrecognized compensation (in dollars)
23 
 
 
Weighted-average period over which compensation expense is expected to be recognized (in years)
1 year 8 months 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested [Roll Forward]
 
 
 
Outstanding at the beginning of the period (in shares)
1,462,000 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period
(217,000)
 
 
Outstanding at the end of the period (in shares)
1,552,000 
1,462,000 
 
Weighted Average Fair Value Per Share [Roll Forward]
 
 
 
Outstanding at the beginning of the period (in dollars per share)
$ 32.33 
 
 
Granted (in dollars per share)
$ 29.52 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period
(781,000)
 
 
Outstanding at the end of the period (in dollars per share)
$ 32.99 
$ 32.33 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value
$ 26.84 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value
$ 33.27 
 
 
Employee Stock Option [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Term of stock options (in years)
10 years 
 
 
Vesting period (in years)
3 years 
 
 
Stock-based compensation expense (in dollars)
9 
15 
17 
Aggregate Intrinsic Value [Abstract]
 
 
 
Unrecognized compensation (in dollars)
$ 8 
 
 
Weighted-average period over which compensation expense is expected to be recognized (in years)
1 year 0 months 
 
 
Shareholders' Equity (Details 2) (USD $)
3 Months Ended 12 Months Ended
Jan. 28, 2017
Oct. 29, 2016
Jul. 30, 2016
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Feb. 1, 2014
Jun. 30, 2011
Outstanding Options to Purchase Common Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Net cash proceeds from the exercise of stock options (in dollars)
 
 
 
 
 
 
 
 
$ 164,000,000 
$ 40,000,000 
$ 42,000,000 
 
 
Weighted-average grant-date fair value of stock options granted (in dollars per share)
 
 
 
 
 
 
 
 
$ 8.04 
$ 11.59 
$ 9.09 
 
 
Exercisable stock options (in shares)
5,900,000 
 
 
 
 
 
 
 
5,900,000 
 
 
 
 
Percentage of exercisable stock options (as a percent)
100.00% 
 
 
 
 
 
 
 
100.00% 
 
 
 
 
Exercisable stock options, weighted-average price (in dollars per share)
$ 36.64 
 
 
 
 
 
 
 
$ 36.64 
 
 
 
 
Unexercisable stock options (in shares)
1,100,000.0 
 
 
 
 
 
 
 
1,100,000.0 
 
 
 
 
Percentage of unexercisable stock options (as a percent)
100.00% 
 
 
 
 
 
 
 
100.00% 
 
 
 
 
Unexercisable stock options, weighted-average price (in dollars per share)
$ 36.54 
 
 
 
 
 
 
 
$ 36.54 
 
 
 
 
Total outstanding stock options (in shares)
6,987,000 
 
 
 
14,242,000 
 
 
 
6,987,000 
14,242,000 
 
 
 
Percentage of outstanding stock options (as a percent)
100.00% 
 
 
 
 
 
 
 
100.00% 
 
 
 
 
Outstanding stock options, weighted-average price (in dollars per share)
$ 36.61 
 
 
 
$ 36.51 
 
 
 
$ 36.61 
$ 36.51 
 
 
 
Numerator [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (Loss) from Continuing Operations, Including Portion Attributable to Noncontrolling Interest
607,000,000 
192,000,000 
182,000,000 
226,000,000 
477,000,000 
129,000,000 
164,000,000 
37,000,000 
1,207,000,000 
807,000,000 
1,246,000,000 
 
 
Denominator [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average common shares outstanding (in shares)
 
 
 
 
 
 
 
 
318,500,000 
346,500,000 
349,500,000 
 
 
Effect of Potentially Dilutive Securities [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Stock options and other (in shares)
 
 
 
 
 
 
 
 
4,100,000 
4,200,000 
4,100,000 
 
 
Weighted-average common shares outstanding, assuming dilution (in shares)
 
 
 
 
 
 
 
 
322,600,000 
350,700,000 
353,600,000 
 
 
Earnings per share attributable to Best Buy Co., Inc.
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic (in dollars per share)
 
 
 
 
 
 
 
 
$ 3.79 
$ 2.33 
$ 3.57 
 
 
Diluted (in dollars per share)
$ 1.91 
$ 0.60 
$ 0.56 
$ 0.69 
$ 1.39 
$ 0.37 
$ 0.46 
$ 0.10 
$ 3.74 
$ 2.30 
$ 3.53 
 
 
Share repurchases authorized (in shares)
 
 
 
 
 
 
 
 
 
 
 
 
5,000,000,000 
Open Market Repurchases [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Stock Repurchased and Retired at ASR Settlement, Shares
 
 
 
 
 
 
 
 
1,600,000 
 
 
 
 
Stock Repurchased and Retired During Period, Value
 
 
 
 
 
 
 
 
45,000,000 
120,000,000 
 
 
 
Payments for Repurchase of Common Stock
 
 
 
 
 
 
 
 
698,000,000 
1,000,000,000 
0 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign currency translation
279,000,000 
 
 
 
271,000,000 
 
 
 
279,000,000 
271,000,000 
382,000,000 
485,000,000 
 
Unrealized gains (losses) on available-for-sale investments
0 
 
 
 
0 
 
 
 
0 
0 
0 
7,000,000 
 
Total
279,000,000 
 
 
 
271,000,000 
 
 
 
279,000,000 
271,000,000 
382,000,000 
492,000,000 
 
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Total Intrinsic Value
 
 
 
 
 
 
 
 
55,000,000 
14,000,000 
13,000,000 
 
 
Actual income tax benefit realized from stock option exercises (in dollars)
 
 
 
 
 
 
 
 
19,000,000 
5,000,000 
5,000,000 
 
 
In-the-money [Member]
 
 
 
 
 
 
 
 
 
 
 
 
 
Outstanding Options to Purchase Common Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Exercisable stock options (in shares)
2,300,000.0 
 
 
 
 
 
 
 
2,300,000.0 
 
 
 
 
Percentage of exercisable stock options (as a percent)
39.00% 
 
 
 
 
 
 
 
39.00% 
 
 
 
 
Exercisable stock options, weighted-average price (in dollars per share)
$ 26.38 
 
 
 
 
 
 
 
$ 26.38 
 
 
 
 
Unexercisable stock options (in shares)
500,000.0 
 
 
 
 
 
 
 
500,000.0 
 
 
 
 
Percentage of unexercisable stock options (as a percent)
45.00% 
 
 
 
 
 
 
 
45.00% 
 
 
 
 
Unexercisable stock options, weighted-average price (in dollars per share)
$ 30.84 
 
 
 
 
 
 
 
$ 30.84 
 
 
 
 
Total outstanding stock options (in shares)
2,800,000.0 
 
 
 
 
 
 
 
2,800,000.0 
 
 
 
 
Percentage of outstanding stock options (as a percent)
40.00% 
 
 
 
 
 
 
 
40.00% 
 
 
 
 
Outstanding stock options, weighted-average price (in dollars per share)
$ 27.13 
 
 
 
 
 
 
 
$ 27.13 
 
 
 
 
Out-of-the-money [Member]
 
 
 
 
 
 
 
 
 
 
 
 
 
Outstanding Options to Purchase Common Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Exercisable stock options (in shares)
3,600,000.0 
 
 
 
 
 
 
 
3,600,000.0 
 
 
 
 
Percentage of exercisable stock options (as a percent)
61.00% 
 
 
 
 
 
 
 
61.00% 
 
 
 
 
Exercisable stock options, weighted-average price (in dollars per share)
$ 43.45 
 
 
 
 
 
 
 
$ 43.45 
 
 
 
 
Unexercisable stock options (in shares)
600,000.0 
 
 
 
 
 
 
 
600,000.0 
 
 
 
 
Percentage of unexercisable stock options (as a percent)
55.00% 
 
 
 
 
 
 
 
55.00% 
 
 
 
 
Unexercisable stock options, weighted-average price (in dollars per share)
$ 40.66 
 
 
 
 
 
 
 
$ 40.66 
 
 
 
 
Total outstanding stock options (in shares)
4,200,000.0 
 
 
 
 
 
 
 
4,200,000.0 
 
 
 
 
Percentage of outstanding stock options (as a percent)
60.00% 
 
 
 
 
 
 
 
60.00% 
 
 
 
 
Outstanding stock options, weighted-average price (in dollars per share)
$ 43.01 
 
 
 
 
 
 
 
$ 43.01 
 
 
 
 
Time-Based Share Awards [Member]
 
 
 
 
 
 
 
 
 
 
 
 
 
Outstanding Options to Purchase Common Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Share-based Payment Award, Award Vesting Period, Maximum
 
 
 
 
 
 
 
 
4 years 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights
 
 
 
 
 
 
 
 
25% of the award vests on the date of grant and 25% vests on each of the three anniversary dates thereafter 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
 
 
 
 
 
 
 
 
2,979,000 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value
 
 
 
 
 
 
 
 
$ 32.76 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period
 
 
 
 
 
 
 
 
2,202,000 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value
 
 
 
 
 
 
 
 
$ 30.83 
 
 
 
 
Unrecognized compensation (in dollars)
98,000,000 
 
 
 
 
 
 
 
98,000,000 
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average period over which compensation expense is expected to be recognized (in years)
 
 
 
 
 
 
 
 
1 year 8 months 
 
 
 
 
Market-based [Member]
 
 
 
 
 
 
 
 
 
 
 
 
 
Outstanding Options to Purchase Common Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value
 
 
 
 
 
 
 
 
$ 33.27 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period
 
 
 
 
 
 
 
 
781,000 
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Vested in Period, Weighted Average Grant Date Fair Value
 
 
 
 
 
 
 
 
$ 26.84 
 
 
 
 
Unrecognized compensation (in dollars)
23,000,000 
 
 
 
 
 
 
 
23,000,000 
 
 
 
 
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average period over which compensation expense is expected to be recognized (in years)
 
 
 
 
 
 
 
 
1 year 8 months 
 
 
 
 
Employee Stock [Member]
 
 
 
 
 
 
 
 
 
 
 
 
 
Outstanding Options to Purchase Common Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Issuance of common stock under employee stock purchase plan (in shares)
 
 
 
 
 
 
 
 
200,000 
200,000 
300,000 
 
 
Open market [Domain]
 
 
 
 
 
 
 
 
 
 
 
 
 
Open Market Repurchases [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Average share price
 
 
 
 
 
 
 
 
 
$ 31.03 
 
 
 
June 2011 share repurchase program [Member}
 
 
 
 
 
 
 
 
 
 
 
 
 
Outstanding Options to Purchase Common Stock [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
Amounting remaining for additional share repurchases
2,200,000,000 
 
 
 
 
 
 
 
2,200,000,000 
 
 
 
 
Open Market Repurchases [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Total number of shares repurchased
 
 
 
 
 
 
 
 
21,100,000 
32,800,000 
 
 
 
Payments for Repurchase of Common Stock
 
 
 
 
 
 
 
 
751,000,000 
1,000,000,000 
 
 
 
Average share price
 
 
 
 
 
 
 
 
$ 35.54 
$ 30.53 
 
 
 
June 2011 share repurchase program [Member} |
Open market [Domain]
 
 
 
 
 
 
 
 
 
 
 
 
 
Open Market Repurchases [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Stock Repurchased and Retired During Period, Value
 
 
 
 
 
 
 
 
$ 706,000,000 
$ 880,000,000 
 
 
 
Average share price
 
 
 
 
 
 
 
 
$ 36.11 
 
 
 
 
January 2016 ASR [Domain]
 
 
 
 
 
 
 
 
 
 
 
 
 
Open Market Repurchases [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Stock Repurchased and Retired at ASR Settlement, Shares
 
 
 
 
 
 
 
 
1,600,000 
4,400,000 
 
 
 
January 2016 ASR [Domain] |
Open market [Domain]
 
 
 
 
 
 
 
 
 
 
 
 
 
Open Market Repurchases [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Average share price
 
 
 
 
 
 
 
 
$ 28.55 
$ 27.28 
 
 
 
Open market [Domain]
 
 
 
 
 
 
 
 
 
 
 
 
 
Open Market Repurchases [Abstract]
 
 
 
 
 
 
 
 
 
 
 
 
 
Total number of shares repurchased
 
 
 
 
 
 
 
 
19,500,000 
28,400,000 
 
 
 
Shareholders' Equity Components of Accumulated Other Comprehensive Income (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Feb. 1, 2014
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Foreign currency translation
$ 279 
$ 271 
$ 382 
$ 485 
Accumulated Other Comprehensive Income (Loss), Available-for-sale Securities Adjustment, Net of Tax
0 
0 
0 
7 
Accumulated other comprehensive income
279 
271 
382 
492 
Foreign currency translation adjustments
10 
(44)
(103)
 
Unrealized loss on available-for-sale investments
0 
0 
(3)
 
Reclassification of foreign currency translations adjustments into earnings due to sale of business
(2)
(67)
0 
 
Reclassification of (gains) losses on available-for-sale investments into earnings
 
 
(4)
 
Parent [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Foreign currency translation adjustments
10 
(44)
(103)
 
Unrealized loss on available-for-sale investments
 
 
(3)
 
Reclassification of foreign currency translations adjustments into earnings due to sale of business
(2)
(67)
 
 
Reclassification of (gains) losses on available-for-sale investments into earnings
 
 
(4)
 
Accumulated Foreign Currency Adjustment Attributable to Parent [Member]
 
 
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
 
 
Reclassification of foreign currency translations adjustments into earnings due to sale of business
 
$ 67 
 
 
Shareholders' Equity Accelerated Share Repurchase (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Equity [Abstract]
 
 
Accelerated Share Repurchase Price (low end of the range)
$ 150 
 
Accelerated Share Repurchase Price (high end of the range)
175 
 
Stock Repurchased and Retired at ASR Settlement, Shares
1.6 
 
Prepaid repurchase of common stock
(55)
55 
Stock Repurchased and Retired During Period, Value
45 
120 
Accelerated Share Repurchase Settlement Amount
 
165 
Accelerated Share Repurchases, Description of Adjustment to Initial Price Paid
$ 10 
 
Shareholders' Equity Performance-based Share Awards (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Time-Based Share Awards [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Unrecognized compensation (in dollars)
$ 98 
Weighted-average period over which compensation expense is expected to be recognized (in years)
1 year 8 months 
Performance-Based Share Awards [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Unrecognized compensation (in dollars)
$ 5 
Weighted-average period over which compensation expense is expected to be recognized (in years)
1 year 9 months 
Shareholders' Equity Share-based Compensation Arrangements by Share-based Payment Award, Equity Instruments Other Than Options, Forfeitures (Details) (Time-Based Share Awards [Member])
12 Months Ended
Jan. 28, 2017
Time-Based Share Awards [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period
515,000 
Shareholders' Equity Share-based Payment Award, Award Vesting Period (Details) (Time-Based Share Awards [Member])
12 Months Ended
Jan. 28, 2017
Time-Based Share Awards [Member]
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
Share-based Payment Award, Award Vesting Period, Minimum
3 years 
Share-based Payment Award, Award Vesting Period, Maximum
4 years 
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Annual Vesting Percentage
25.00% 
Shareholders' Equity Time-based Share Awards (Details) (USD $)
In Millions, except Share data, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Granted (in dollars per share)
$ 31.79 
 
 
Time-Based Share Awards [Member]
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Granted (in dollars per share)
$ 30.68 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number
5,365,000 
5,103,000 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value
$ 31.57 
$ 31.89 
 
Stock-based compensation expense (in dollars)
$ 78 
$ 73 
$ 60 
Leases (Details) (USD $)
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Operating Leases, Rent Expense, Net [Abstract]
 
 
 
Minimum rentals
$ 789,000,000 
$ 797,000,000 
$ 848,000,000 
Contingent rentals
1,000,000 
1,000,000 
2,000,000 
Total rent expense
790,000,000 
798,000,000 
850,000,000 
Less: sublease income
(16,000,000)
(15,000,000)
(18,000,000)
Net rent expense
774,000,000 
783,000,000 
832,000,000 
Future minimum lease payments under capital leases
 
 
 
2018
9,000,000 
 
 
2019
7,000,000 
 
 
2020
4,000,000 
 
 
2021
3,000,000 
 
 
2021
2,000,000 
 
 
Thereafter
11,000,000 
 
 
Subtotal
36,000,000 
 
 
Less: imputed interest
(6,000,000)
 
 
Capital Leases, Future Minimum Payments, Present Value
30,000,000 
 
 
Capital Lease Obligations, Current
(8,000,000)
 
 
Present value
22,000,000 
 
 
Future minimum lease payments under financing leases
 
 
 
Financing Leases, Future Minimum Payments Due, Next Twelve Months
46,000,000 
 
 
2019
41,000,000 
 
 
2020
35,000,000 
 
 
2021
28,000,000 
 
 
2022
20,000,000 
 
 
Thereafter
56,000,000 
 
 
Subtotal
226,000,000 
 
 
Less: imputed interest
(49,000,000)
 
 
Financing Leases, Future Minimum Payments, Present Value
177,000,000 
 
 
2018
(36,000,000)
 
 
Present value
141,000,000 
 
 
Future minimum lease payments under operating leases
 
 
 
2018
803,000,000 1
 
 
2019
676,000,000 1
 
 
2020
546,000,000 1
 
 
2021
411,000,000 1
 
 
2022
285,000,000 1
 
 
Thereafter
404,000,000 1
 
 
Subtotal
3,125,000,000 1
 
 
Other Operating Lease Payments
1,000,000,000 
 
 
Minimum sublease rent income excluded from minimum lease payments
$ 79,000,000 
 
 
Benefit Plans (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items]
 
 
 
Maximum percentage of a participant's eligible compensation that a participant may contribute annually to the plan (as a percent)
50.00% 
 
 
Percentage of matching contribution made by company of first 3% of participating employees' contributions (as a percent)
100.00% 
 
 
Percentage of participating employees' contribution, matched 100% (as a percent)
3.00% 
 
 
Percentage of matching contribution made by company, of next 2% of participating employees' contributions (as a percent)
50.00% 
 
 
Percentage of participating employees' contribution, matched 50% (as a percent)
2.00% 
 
 
Defined Contribution Plan, Cost Recognized
$ 56 
$ 53 
$ 60 
Non-qualified, unfunded deferred compensation plan [Member]
 
 
 
Deferred Compensation Arrangement with Individual, Postretirement Benefits [Line Items]
 
 
 
Deferred Compensation Liability, Classified, Noncurrent
31 
34 
 
Deferred Compensation Plan Assets
$ 96 
$ 96 
 
Income Taxes - Tax Rate Reconciliation (Details) (USD $)
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Mar. 3, 2012
Income Tax Disclosure [Abstract]
 
 
 
 
Profit Share Buy-Out Purchase Price
 
 
 
$ 1,300,000,000 
Reconciliation of the federal statutory income tax rate to income tax expense
 
 
 
 
Federal income tax at the statutory rate
635,000,000 
458,000,000 
485,000,000 
 
State income taxes, net of federal benefit
38,000,000 
38,000,000 
43,000,000 
 
(Benefit) expense from foreign operations
(46,000,000)
5,000,000 
(23,000,000)
 
Other
(18,000,000)
2,000,000 
(11,000,000)
 
Effective Income Tax Rate Reconciliation, Legal Entity Reorganization
0 
0 
(353,000,000)
 
Income tax expense
$ 609,000,000 
$ 503,000,000 
$ 141,000,000 
 
Effective income tax rate
33.50% 
38.40% 
10.10% 
 
Income Taxes - Income Tax Expense (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Earnings from continuing operations before income tax expense and equity in (loss) income of affiliates
 
 
 
United States
$ 1,507 
$ 1,310 
$ 1,201 
Outside the United States
309 
0 
186 
Earnings from continuing operations before income tax expense
1,816 
1,310 
1,387 
Current:
 
 
 
Federal
317 
347 
354 
State
37 
48 
51 
Foreign
54 
60 
33 
Current income tax expense
408 
455 
438 
Deferred:
 
 
 
Federal
163 
65 
(275)
State
21 
10 
(26)
Foreign
17 
(27)
4 
Deferred income tax expense
201 
48 
(297)
Income tax expense
$ 609 
$ 503 
$ 141 
Income Taxes - Components of Deferreds (Details) (USD $)
In Millions, unless otherwise specified
Jan. 28, 2017
Jan. 30, 2016
Components of deferred tax assets and liabilities
 
 
Accrued property expenses
$ 91 
$ 175 
Other accrued expenses
76 
78 
Deferred revenue
104 
99 
Compensation and benefits
43 
99 
Stock-based compensation
64 
86 
Deferred Tax Assets, Goodwill and Intangible Assets
210 
253 
Loss and credit carryforwards
123 
133 
Other
59 
86 
Total deferred tax assets
770 
1,009 
Valuation allowance
(94)
(108)
Total deferred tax assets after valuation allowance
676 
901 
Property and equipment
(240)
(296)
Inventory
(97)
(69)
Other
(22)
(26)
Total deferred tax liabilities
(359)
(391)
Net deferred tax assets
317 
510 
Net deferred tax assets
$ 317 
$ 510 
Income Taxes - Tax Credit and Operating Loss Carryforwards (Details) (USD $)
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Tax Credit Carryforward [Line Items]
 
 
Valuation allowance
$ 94,000,000 
$ 108,000,000 
Decrease in the valuation allowance, related to the international net operating loss carryforwards and other international deferred tax assets
14,000,000 
 
Unremitted earnings of foreign operations
1,100,000,000 
 
State [Member]
 
 
Tax Credit Carryforward [Line Items]
 
 
Tax credit carryforwards
10,000,000 
 
Tax credit carryforwards, valuation allowance
7,000,000 
 
Capital Loss Carryforwards [Member] |
State [Member]
 
 
Tax Credit Carryforward [Line Items]
 
 
Tax credit carryforwards
5,000,000 
 
Capital Loss Carryforwards [Member] |
U.S. and State [Member]
 
 
Tax Credit Carryforward [Line Items]
 
 
Tax credit carryforwards, valuation allowance
16,000,000 
 
Federal [Member] |
U.S. [Member]
 
 
Tax Credit Carryforward [Line Items]
 
 
Total net operating loss carryforwards
17,000,000 
 
Federal [Member] |
Foreign Tax Credit Carryforwards [Member] |
U.S. [Member]
 
 
Tax Credit Carryforward [Line Items]
 
 
Tax credit carryforwards
1,000,000 
 
Tax credit carryforwards, valuation allowance
1,000,000 
 
Federal [Member] |
Capital Loss Carryforwards [Member] |
U.S. [Member]
 
 
Tax Credit Carryforward [Line Items]
 
 
Tax credit carryforwards
3,000,000 
 
International [Member]
 
 
Tax Credit Carryforward [Line Items]
 
 
Total net operating loss carryforwards
77,000,000 
 
Net operating loss carryforwards subject to expiration
70,000,000 
 
Tax credit carryforwards
2,000,000 
 
Net operating loss carryforwards, valuation allowance
70,000,000 
 
International [Member] |
Capital Loss Carryforwards [Member]
 
 
Tax Credit Carryforward [Line Items]
 
 
Tax credit carryforwards
$ 8,000,000 
 
Income Taxes - Unrecognized Tax Benefits (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Reconciliation of changes in unrecognized tax benefits
 
 
 
Balance at beginning of period
$ 469 
$ 410 
$ 370 
Gross increases related to prior period tax positions
11 
30 
33 
Gross decreases related to prior period tax positions
(144)
(13)
(88)
Gross increases related to current period tax positions
55 
59 
114 
Settlements with taxing authorities
(12)
(9)
(9)
Lapse of statute of limitations
(5)
(8)
(10)
Balance at end of period
374 
469 
410 
Unrecognized tax benefits that would impact the effective tax rate if recognized
346 
337 
297 
Interest expense recognized as component of income tax expense
9 
 
 
Accrued interest in income tax expense
61 
89 
78 
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense
$ 1 
$ 1 
$ 2 
Segment and Geographic Information - Segment Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended 12 Months Ended
Jan. 28, 2017
Oct. 29, 2016
Jul. 30, 2016
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
segments
Jan. 30, 2016
Jan. 31, 2015
Jan. 28, 2017
Domestic [Member]
Jan. 30, 2016
Domestic [Member]
Jan. 31, 2015
Domestic [Member]
Jan. 28, 2017
Domestic [Member]
Consumer Electronics [Member]
Jan. 30, 2016
Domestic [Member]
Consumer Electronics [Member]
Jan. 31, 2015
Domestic [Member]
Consumer Electronics [Member]
Jan. 28, 2017
Domestic [Member]
Computing and Mobile Phones [Member]
Jan. 30, 2016
Domestic [Member]
Computing and Mobile Phones [Member]
Jan. 31, 2015
Domestic [Member]
Computing and Mobile Phones [Member]
Jan. 28, 2017
Domestic [Member]
Entertainment [Member]
Jan. 30, 2016
Domestic [Member]
Entertainment [Member]
Jan. 31, 2015
Domestic [Member]
Entertainment [Member]
Jan. 28, 2017
Domestic [Member]
Appliances [Member]
Jan. 30, 2016
Domestic [Member]
Appliances [Member]
Jan. 31, 2015
Domestic [Member]
Appliances [Member]
Jan. 28, 2017
Domestic [Member]
Services [Member]
Jan. 30, 2016
Domestic [Member]
Services [Member]
Jan. 31, 2015
Domestic [Member]
Services [Member]
Jan. 28, 2017
Domestic [Member]
Other [Member]
Jan. 30, 2016
Domestic [Member]
Other [Member]
Jan. 31, 2015
Domestic [Member]
Other [Member]
Jan. 28, 2017
International [Member]
Jan. 30, 2016
International [Member]
Jan. 31, 2015
International [Member]
Jan. 28, 2017
International [Member]
Consumer Electronics [Member]
Jan. 30, 2016
International [Member]
Consumer Electronics [Member]
Jan. 31, 2015
International [Member]
Consumer Electronics [Member]
Jan. 28, 2017
International [Member]
Computing and Mobile Phones [Member]
Jan. 30, 2016
International [Member]
Computing and Mobile Phones [Member]
Jan. 31, 2015
International [Member]
Computing and Mobile Phones [Member]
Jan. 28, 2017
International [Member]
Entertainment [Member]
Jan. 30, 2016
International [Member]
Entertainment [Member]
Jan. 31, 2015
International [Member]
Entertainment [Member]
Jan. 28, 2017
International [Member]
Appliances [Member]
Jan. 30, 2016
International [Member]
Appliances [Member]
Jan. 31, 2015
International [Member]
Appliances [Member]
Jan. 28, 2017
International [Member]
Services [Member]
Jan. 30, 2016
International [Member]
Services [Member]
Jan. 31, 2015
International [Member]
Services [Member]
Jan. 28, 2017
International [Member]
Other [Member]
Jan. 30, 2016
International [Member]
Other [Member]
Jan. 31, 2015
International [Member]
Other [Member]
Feb. 1, 2014
International [Member]
Other [Member]
Jan. 28, 2017
Continuing Operations [Member]
Jan. 30, 2016
Continuing Operations [Member]
Jan. 31, 2015
Continuing Operations [Member]
Jan. 28, 2017
Continuing Operations [Member]
Domestic [Member]
Jan. 30, 2016
Continuing Operations [Member]
Domestic [Member]
Jan. 31, 2015
Continuing Operations [Member]
Domestic [Member]
Jan. 28, 2017
Continuing Operations [Member]
International [Member]
Jan. 30, 2016
Continuing Operations [Member]
International [Member]
Jan. 31, 2015
Continuing Operations [Member]
International [Member]
Business segment information
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of reportable segments
 
 
 
 
 
 
 
 
2 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total revenue
$ 13,482 
$ 8,945 
$ 8,533 
$ 8,443 
$ 13,623 
$ 8,819 
$ 8,528 
$ 8,558 
$ 39,403 
$ 39,528 
$ 40,339 
$ 36,248 
$ 36,365 
$ 36,055 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 3,155 
$ 3,163 
$ 4,284 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percentage of revenue, by revenue category (as a percent)
 
 
 
 
 
 
 
 
 
 
 
100.00% 
100.00% 
100.00% 
34.00% 
32.00% 
31.00% 
45.00% 
46.00% 
47.00% 
7.00% 
8.00% 
9.00% 
9.00% 
8.00% 
7.00% 
5.00% 
5.00% 
5.00% 
0.00% 
1.00% 
1.00% 
100.00% 
100.00% 
100.00% 
31.00% 
31.00% 
30.00% 
48.00% 
48.00% 
49.00% 
7.00% 
9.00% 
9.00% 
6.00% 
5.00% 
5.00% 
7.00% 
6.00% 
6.00% 
1.00% 
1.00% 
1.00% 
 
 
 
 
 
 
 
 
 
 
Maximum percentage of revenue, by revenue category (as a percent)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1.00% 
1.00% 
 
 
 
 
 
 
 
 
 
Operating income (loss)
881 1
312 1
289 1
372 1
771 2
230 2
288 2
86 2
1,854 1
1,375 2
1,450 
1,764 
1,585 
1,437 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
90 
(210)
13 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other income (expense)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gain on sale of investments
 
 
 
 
 
 
 
 
3 
2 
13 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investment income and other
 
 
 
 
 
 
 
 
31 
13 
14 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest expense
 
 
 
 
 
 
 
 
(72)
(80)
(90)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings from continuing operations before income tax expense
 
 
 
 
 
 
 
 
1,816 
1,310 
1,387 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Assets
13,856 3
 
 
 
13,519 3
 
 
 
13,856 3
13,519 3
15,245 3
12,496 3
12,318 3
12,987 3
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
1,360 3
1,201 3
2,258 3
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total capital expenditures
 
 
 
 
 
 
 
 
582 4
649 4
561 4
526 4
602 4
519 4
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
56 4
47 4
42 4
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total depreciation
 
 
 
 
 
 
 
 
$ 654 
$ 657 
$ 656 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 654 4
$ 657 4
$ 656 4
$ 613 4
$ 613 4
$ 575 4
$ 41 4
$ 44 4
$ 81 4
Segment and Geographic Information - Geographic Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 28, 2017
Oct. 29, 2016
Jul. 30, 2016
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Geographic Areas, Revenues from External Customers [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Total revenue
$ 13,482 
$ 8,945 
$ 8,533 
$ 8,443 
$ 13,623 
$ 8,819 
$ 8,528 
$ 8,558 
$ 39,403 
$ 39,528 
$ 40,339 
Geographic Areas, Long-Lived Assets [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Property, Plant and Equipment, Net
2,293 
 
 
 
2,346 
 
 
 
2,293 
2,346 
2,295 
United States [Member]
 
 
 
 
 
 
 
 
 
 
 
Geographic Areas, Revenues from External Customers [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Total revenue
 
 
 
 
 
 
 
 
36,248 
36,365 
36,055 
Geographic Areas, Long-Lived Assets [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Property, Plant and Equipment, Net
2,120 
 
 
 
2,189 
 
 
 
2,120 
2,189 
2,100 
Canada [Member]
 
 
 
 
 
 
 
 
 
 
 
Geographic Areas, Revenues from External Customers [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Total revenue
 
 
 
 
 
 
 
 
2,899 
2,917 
4,047 
Geographic Areas, Long-Lived Assets [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Property, Plant and Equipment, Net
156 
 
 
 
140 
 
 
 
156 
140 
174 
Other [Member]
 
 
 
 
 
 
 
 
 
 
 
Geographic Areas, Revenues from External Customers [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Total revenue
 
 
 
 
 
 
 
 
256 
246 
237 
Geographic Areas, Long-Lived Assets [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Property, Plant and Equipment, Net
$ 17 
 
 
 
$ 17 
 
 
 
$ 17 
$ 17 
$ 21 
Contingencies and Commitments - Commitments (Details) (Outstanding letters of credit and bankers' acceptances [Member], USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Outstanding letters of credit and bankers' acceptances [Member]
 
Commitments [Line Items]
 
Unrecorded Unconditional Purchase Obligation, Purchases
$ 89 
Contingencies and Commitments Gain Contingencies (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
Jan. 30, 2016
Gain Contingencies [Line Items]
 
 
 
 
 
 
 
Proceeds from Legal Settlements, net of related legal fees and costs
$ 161 
$ 2 
$ 0 
$ 8 
$ 67 
$ 161 
$ 77 
Proceeds from Legal Settlements
$ 183 
$ 2 
$ 0 
$ 10 
$ 78 
$ 183 
$ 90 
Supplementary Financial Information (Unaudited) (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 28, 2017
Oct. 29, 2016
Jul. 30, 2016
Apr. 30, 2016
Jan. 30, 2016
Oct. 31, 2015
Aug. 1, 2015
May 2, 2015
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Quarterly Financial Information [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 13,482 
$ 8,945 
$ 8,533 
$ 8,443 
$ 13,623 
$ 8,819 
$ 8,528 
$ 8,558 
$ 39,403 
$ 39,528 
$ 40,339 
Comparable store sales % change (as a percent)
(0.70%)1
1.80% 1
0.80% 1
(0.10%)1
(1.70%)1
0.80% 1
3.80% 1
0.60% 1
0.30% 1
0.50% 1
 
Gross Profit
3,030 2
2,203 2
2,062 2
2,145 2
2,951 3
2,112 3
2,098 3
2,030 3
9,440 2
9,191 3
9,047 
Operating income (loss)
881 4
312 4
289 4
372 4
771 5
230 5
288 5
86 5
1,854 4
1,375 5
1,450 
Net earnings (loss) from continuing operations
607 
192 
182 
226 
477 
129 
164 
37 
1,207 
807 
1,246 
Gain from discontinued operations, net of tax
0 
2 
16 
3 
2 
(4)
0 
92 
21 
90 
(11)
Net earnings including noncontrolling interests
 
 
 
 
 
 
 
 
1,228 
897 
1,235 
Net earnings attributable to Best Buy Co., Inc.
607 
194 
198 
229 
479 
125 
164 
129 
1,228 
897 
1,233 
Diluted earnings (loss) per share
 
 
 
 
 
 
 
 
 
 
 
Continuing operations
$ 1.91 
$ 0.60 
$ 0.56 
$ 0.69 
$ 1.39 
$ 0.37 
$ 0.46 
$ 0.10 
$ 3.74 
$ 2.30 
$ 3.53 
Discontinued operations
$ 0.00 
$ 0.01 
$ 0.05 
$ 0.01 
$ 0.01 
$ (0.01)
$ 0.00 
$ 0.26 
$ 0.07 
$ 0.26 
$ (0.04)
Diluted (in dollars per share)
$ 1.91 6
$ 0.61 6
$ 0.61 6
$ 0.70 6
$ 1.40 6
$ 0.36 6
$ 0.46 6
$ 0.36 6
$ 3.81 6
$ 2.56 6
$ 3.49 
Months until inclusion in comparable store sales
 
 
 
 
 
 
 
 
14 months 
 
 
Days Until Excluded From Comparable Sales
 
 
 
 
 
 
 
 
14 days 
 
 
Proceeds from Legal Settlements
 
 
 
183 
2 
0 
10 
78 
183 
90 
 
Restructuring charges
9 
1 
0 
29 
12 
7 
(4)
186 
39 
201 
23 
Proceeds from Legal Settlements, net of related legal fees and costs
 
 
 
161 
2 
0 
8 
67 
161 
77 
 
Continuing Operations [Member]
 
 
 
 
 
 
 
 
 
 
 
Diluted earnings (loss) per share
 
 
 
 
 
 
 
 
 
 
 
Restructuring charges
 
 
 
 
 
 
 
 
$ 39 
$ 201 
 
[1] Our comparable sales calculation compares revenue from stores, websites and call centers operating for at least 14 full months, as well as revenue related to certain other comparable sales channels for a particular period to the corresponding period in the prior year. Relocated stores, as well as remodeled, expanded and downsized stores closed more than 14 days, are excluded from our comparable sales calculation until at least 14 full months after reopening. Acquisitions are included in the comparable sales calculation beginning with the first full quarter following the first anniversary of the date of the acquisition. The Canadian brand consolidation, which included the permanent closure of 66 Future Shop stores, the conversion of 65 Future Shop stores to Best Buy stores and the elimination of the Future Shop website, had a material impact on a year-over-year basis on the remaining Canadian retail stores and the website. As such, from the first quarter of fiscal 2016 through the third quarter of fiscal 2017, all Canadian store and website revenue was removed from the comparable sales base and the International segment no longer had a comparable metric. Therefore, Consolidated comparable sales equaled the Domestic segment comparable sales. Beginning in the fourth quarter of fiscal 2017, we resumed reporting International comparable sales as revenue in the International segment was once again deemed to be comparable and, as such, Consolidated comparable sales are once again equal to the aggregation of Domestic and International comparable sales.
Valuation and Qualifying Accounts (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Jan. 31, 2015
Activity in valuation and qualifying accounts
 
 
 
Balance at End of Period
$ 52 
$ 49 
 
Allowance for Doubtful Accounts [Member]
 
 
 
Activity in valuation and qualifying accounts
 
 
 
Balance at Beginning of Period
49 
59 
104 
Charged to Expenses or Other Accounts
44 
30 
1 
Other
(41)1
(40)1
(46)1
Balance at End of Period
$ 52 
$ 49 
$ 59 
Schedule of Nonvested, Performance-based Share Award Activity (Details) (USD $)
12 Months Ended
Jan. 28, 2017
Jan. 30, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Granted (in dollars per share)
$ 31.79 
 
Performance-Based Share Awards [Member]
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value
$ 28.98 
$ 0.00 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period
513,000 
 
Granted (in dollars per share)
$ 29.08 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeited in Period
(75,000)
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Forfeitures, Weighted Average Grant Date Fair Value
$ 29.66 
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number
438,000 
0